Trump, Saudis sign deals

‘STRATE­GIC VI­SION’ WORTH $110 BIL­LION Pres­i­dent touts jobs, ‘tremen­dous’ in­vest­ment


riyadh, saudi ara­bia — Pres­i­dent Trump made a splashy de­but on the world stage here Satur­day, ush­er­ing in a new era in U.S.-Saudi Ara­bian re­la­tions by sign­ing a joint “strate­gic vi­sion” that in­cludes $110 bil­lion in Amer­i­can arms sales and other new in­vest­ments that the ad­min­is­tra­tion said would bring hun­dreds of thou­sands of jobs.

“It was a great day,” Trump said. He cited “tremen­dous in­vest­ments in the United States . . . and jobs, jobs, jobs.”

While ini­tial de­tails were scant, the agree­ments signed in­cluded a U.S. let­ter of in­tent to “sup­port Saudi Ara­bia’s de­fense needs” with sales of a num­ber of items — naval ships, tanks and other ve­hi­cles — that were the sub­ject of agree­ments un­der ear­lier ad­min­is­tra­tions, as well as some new items that had never passed the dis­cus­sion stage, such as so­phis­ti­cated THAAD mis­sile de­fense sys­tems.

Other items are in­tended to mod­ern­ize Saudi Ara­bia’s cy­berde­fense and air­borne in­tel­li­gence-gath­er­ing, and se­cure its bor­ders.

Sec­re­tary of State Rex Tiller­son, in a news con­fer­ence with his Saudi coun­ter­part, de­scribed com­mon views on coun­tert­er­ror­ism,

A month ago, Sec­re­tary of State Rex Tiller­son de­liv­ered a brief speech at the U.S.-Saudi Ara­bia CEO sum­mit with a suc­cinct mes­sage: “One of our pol­icy pri­or­i­ties is to get bet­ter deals for the United States.”

On Satur­day, Saudi Ara­bia seemed to de­liver. The king­dom signed ten­ta­tive agree­ments that the Trump ad­min­is­tra­tion said could be worth $110 bil­lion, in­clud­ing fighter jets, ships and mis­siles, as well as en­ergy tech­nol­ogy, health-care ex­per­tise, job train­ing and a $40 bil­lion joint in­fra­struc­ture in­vest­ment fund.

But a huge por­tion of the dol­lar fig­ure re­flects money in­vested in and goods made in the KSA, the king­dom of Saudi Ara­bia, not in the USA.

The gov­ern­ment ex­tracted com­mit­ments from U.S. com­pa­nies to cre­ate more of their jobs and man­u­fac­ture more of their goods in Saudi Ara­bia. Saudi Aramco alone said it inked $50 bil­lion in agree­ments largely aimed at boost­ing lo­cal con­tent and jobs.

It is all part of Vi­sion 2030, Deputy Crown Prince Mo­hammed bin Sal­man’s plan for trans­form­ing the Saudi econ­omy, di­ver­si­fy­ing away from petroleum and pro­vid­ing work for the king­dom’s rest­less un­em­ployed. The 2030 plan aims to build up the share of non-oil ex­ports from the cur­rent level of 16 per­cent to 50 per­cent.

Most of the deals un­veiled Satur­day were mem­o­ran­dums of un­der­stand­ing rather than solid con­tracts, and thus still re­quire fur­ther ne­go­ti­a­tion. Some have been in progress for months. But the fig­ures were am­bi­tious.

Lock­heed Martin said that Saudi Ara­bia “has ex­pressed its in­tent to pro­cure more than $28 bil­lion worth of Lock­heed Martin in­te­grated air and mis­sile de­fense, com­bat ship, tac­ti­cal air­craft and ro­tary wing tech­nolo­gies and pro­grams.” Lock­heed Martin chief ex­ec­u­tive Mar­il­lyn Hew­son said she hoped to “strengthen the cause of peace in the re­gion.”

Hew­son also said that Lock­heed would form a joint ven­ture with state-owned Taq­nia to com­plete 150 S-70 Black Hawk heli­copters. The ven­ture would sup­port 450 jobs at Lock­heed’s Siko­rsky sub­sidiary in Con­necti­cut and 450 jobs in the king­dom, trans­fer­ring some tech­nol­ogy and skills to Saudi Ara­bia. “These agree­ments will di­rectly con­trib­ute to His Majesty’s Vi­sion 2030 by open­ing the door for thou­sands of highly skilled jobs in new eco­nomic sec­tors,” she said.

Gen­eral Elec­tric said it signed mem­o­ran­dums of un­der­stand­ing for the sale of $7 bil­lion of GE tech­nol­ogy and for the train­ing of Saudi cit­i­zens in cloud-based data skills and ex­per­tise in the health­care in­dus­try. GE would also help im­prove ef­fi­ciency in man­u­fac­tur­ing, the state min­ing com­pany and Saudi Aramco. Aramco said it ex­pected GE to cre­ate 250 high­tech Saudi jobs.

The New York-based in­vest­ment firm Black­stone an­nounced a plan to cre­ate a $40 bil­lion in­fra­struc­ture in­vest­ment fund with half the seed money com­ing from the Pub­lic In­vest­ment Fund of Saudi Ara­bia and half to be raised from other in­vestors. Black­stone chief ex­ec­u­tive Steve Sch­warz­man has ad­vised Trump.

While Black­stone is­sued a state­ment Satur­day dur­ing Trump’s trip to Riyadh, the firm noted that the agree­ment was “the cul­mi­na­tion” of talks that be­gan a year ago — when Barack Obama was still in of­fice and the pres­i­den­tial pri­maries were not over. More­over, the mem­o­ran­dum of un­der­stand­ing was “non-bind­ing,” Black­stone said in a state­ment, adding that “the par­ties will con­tinue their ne­go­ti­a­tion.”

Black­stone said it hopes to lever­age the fund and in­vest more than $100 bil­lion in in­fra­struc­ture projects, “prin­ci­pally” but not ex­clu­sively in the United States.

Saudi Aramco an­nounced ten­ta­tive agree­ments with sev­eral firms, each de­signed to cre­ate hun­dreds or thou­sands of lo­cal jobs. The state oil com­pany said it had signed MOUs with oil ser­vice gi­ants Sch­lum­berger, Hal­libur­ton, Weather­ford and Baker Hughes to lo­cal­ize oil field goods and ser­vices and cre­ate a to­tal of 4,850 jobs in the king­dom.

Saudi Aramco also said Na­tional Oil­well Varco would form a joint ven­ture to man­u­fac­ture land rigs and drilling equip­ment in Saudi Ara­bia, and es­tab­lish a train­ing cen­ter for lo­cal work­ers, ul­ti­mately cre­at­ing 1,000 jobs.

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