Trump uses inflated figures to urge ties to Saudi Arabia
WASHINGTON — As President Donald Trump has faced increasing pressure to punish Saudi Arabia over its suspected torture and murder of Saudi journalist Jamal Khashoggi, he has repeatedly cited the country’s value as not only an ally, but also a customer.
“They’re a tremendous purchaser of not only military equipment, but other things,” Trump said this week. “When I went there, they committed to purchase $450 billion worth of things, and $110 billion worth of military. Those are the biggest orders in the history of this country, probably the history of the world.”
Trump’s open talk of sales figures as a factor that could outweigh human rights concerns is a rare stance for an American president, one that conflicts with long-standing national values. Compounding the controversy, the president’s figures are significantly inflated, speculative and further in doubt owing to international revulsion at the Saudis over Khashoggi, according to defense experts and current and prior reviews by The Times.
“To go around and throw a number like that around is really highly misleading, and that’s being generous,” said Richard F. Grimmett, who spent three decades compiling the most authoritative accounting of U.S. military arms sales for the Congressional Research Service before retiring in 2012.
The military sales figures are murky because it takes years to negotiate, approve and build weapons systems for sale to another country. So far, contracting experts and government officials estimate that the Trump administration has agreed to somewhere between about $15 billion to $22 billion in sales to Saudi Arabia, many of which were negotiated during the Obama and George W. Bush administrations.
“It’s showmanship in lot of ways. This $100-billion deal over many years is still much yet to be negotiated, and much of it may never happen,” said Jeff Abramson, a fellow at the nonpartisan Arms Control Association.
The president’s promise to boost the U.S. economy through Saudi purchases dates to his sumptuously feted visit to the kingdom 17 months ago. As his first international trip as president, Trump’s tour was a powerful symbol of his intent to reorient American foreign policy in the Middle East and throughout the world.
As Trump was being celebrated by the Saudi royals — led by King Salman and Crown Prince Mohammed bin Salman, now the nation’s de factor ruler and widely blamed in Khashoggi’s suspected death — the administration announced a $110billion arms deal and a series of commercial deals that it said would lead to a combined total of “upwards of more than $350 billion” in investment in the United States. The Saudi government valued the package at “in excess of $380 billion.”
Trump administration officials could not say where the president came up with the number he used this week, a total of $560 billion. Nor could they provide a list of itemized investment projects.
From the beginning observers raised questions about the commercial aspects of the deal. When the announcement was made in May 2017, administration officials allowed a Times reporter to view a list of 23 projects that were the basis for the president’s investment and jobs claims. The two-page list contained broad ranges of dollar figures, however, and an important caution at the top: “Economic Impact figures are supplied by Saudi sources and are not verified.”
A deeper look at the list underscores why American officials were reluctant to take it at face value, at least behind the scenes.
The biggest project, a $100-billion investment fund backed by the Japanese telecom giant SoftBank, is based far from the United States, on the British island of Jersey. The so-called Vision Fund is expected to benefit American companies and workers. Yet it also has operations in London and Tokyo and plans to invest in technology companies around the world.
An official familiar with the fund’s plans told The Times last year that it viewed the United States as an attractive market but that the firm had no single geographic focus.
Courtesy of a pledge by the crown prince, the Saudi contribution is supposed to be $45 billion — not the full $100 billion listed by the Saudis as its economic impact. Yet even that lesser amount is now in jeopardy.
SoftBank’s chief operating officer, Marcelo Claure, said at a technology conference in Silicon Valley this week that the company is “anxiously looking at what is happening” in the kingdom after Khashoggi’s disappearance, according to the Financial Times. Claure said “there is no certainty” that the tech company will launch phase two of the Vision Fund.
The commercial fallout over Khashoggi’s disappearance could yet run wider. Treasury Secretary Steven T. Mnuchin announced Thursday that he, too, would skip next week’s Saudi-sponsored “Davos in the Desert,” an international business and media conference in Riyadh, joining numerous other foreign officials and corporate leaders in the shunning of the event.
Stephen Schwarzman, the chief executive of the Blackstone Group, the asset management firm, also pulled out of the conference. Blackstone is the second-largest business partner with the Saudi government on the list, with plans to create an infrastructure fund seeded with $20 billion from Saudi Arabia’s Private Investment Fund.
Significantly, Trump’s hopedfor military sales to the Saudis also face trouble closer to home: Members of Congress, who have the power to block future arms sales, are expressing bipartisan anger with Saudi Arabia for its human rights record, including widespread deaths and displacement of civilians in Yemen from Saudi bombings there.