THAAD DEAL IN JEOPARDY
Congressional demands may stop Lockheed’s potential US$15b sale to Saudi Arabia
LOCKHEED Martin Corp’s potential US$15 billion (RM62.4 billion) sale to Saudi Arabia of its Thaad air defence system may be the unfinished deal most vulnerable to growing congressional demands to stop providing arms to the desert kingdom after the killing of critic Jamal Khashoggi.
It also underscores that the US$110 billion package of arms sales that United States President Donald Trump announced on his visit to the Gulf nation last year — and has vowed to protect despite Khashoggi’s death — as always aspirational at best.
“That number is not analytically helpful, that number is politically helpful,” said Centre for Strategic and International Studies Middle East programme director Jon Alterman, here.
“It’s not close to US$110 billion in hardware, and it doesn’t go this year or next year.”
The pending Saudi deals for arms, logistics and training includes sales started during former president Barack Obama’s administration.
Only US$14.5 billion of that involves signed “letters of offer and acceptance” that spell out final terms and prices, according to the Pentagon.
The sale of Lockheed’s Terminal High-Altitude Area Defence system remains under negotiation a year after it was initially approved by Congress.
US officials and congressional aides said although Congress approved the potential Thaad sale early last November, the letter of offer and acceptance agreed to in February has not yet been signed and remains under negotiations.
Lockheed chief financial officer Bruce Tanner told analysts on Tuesday the Thaad deal with the Saudis is “the largest order we’ve been waiting on” that “has not taken place yet”.
He said the company is “not sure when that will take place”.
Now the Thaad sale may be caught up in the growing congressional backlash against the Saudis.
The sentiment was reflected in a bipartisan bill introduced on Tuesday to immediately stop all military sales to Saudi Arabia.
Trump said Tuesday “in terms of what we ultimately do I’m going to leave it very much up to Congress” although he continued to say it would be “foolish” to impede arms deals or investment flows.