£10bn jet deal to Saudis takes off
SAUDI Arabia is poised to buy a fleet of fighter jets from the UK’s biggest defence company, officials said yesterday.
On the final day of Crown Prince Mohammed bin Salman’s three-day visit, he signed a ‘memorandum of intent’ for the kingdom to buy 48 Typhoons from BAE Systems.
The deal could be worth £10billion and would secure jobs, including 5,000 at the company’s Warton and Samlesbury plants in Lancashire and 9,500 in the supply chain.
The long-awaited agreement – in the face of fierce criticism from Labour – came just hours after official figures showed British manufacturers are enjoying their longest period of growth for at least half a century.
A second report from the Office for National Statistics showed exports rose 3.1 per cent in January to £29.5 billion – the second biggest haul of all time – with sales to the United States at a record high.
Philip Hammond welcomed the figures ahead of Tuesday’s spring statement in which he is expected to reveal that the economy is in far better shape than the official forecasters feared. ‘British manufacturing has been growing for nine months in a row,’ the Chancellor said. ‘That’s the longest unbroken run of growth in 50 years. We’re building an economy fit for the future.’
BAE has already sold 620 Typhoon jets, including to Qatar, Oman, Kuwait and Belgium, since a prototype of the aircraft took the skies two decades ago.
But the firm has been waiting anxiously for a new order from Saudi Arabia following the sale of 72 planes in 2007.
The company was forced to slow production of the aircraft because of a lack of orders and was forced to axe 2,000 jobs last autumn as demand for the Typhoon dwindled.
BAE shares rose more than 2 per cent after yesterday’s announcement – adding £408 million to the value of the company.
Defence Secretary Gavin Williamson said: ‘The Crown Prince’s visit has opened a new chapter in our two countries’ historic relationship.’
BAE chief executive Charles Woodburn welcomed ‘a positive step towards agreeing a contract’.
Labour leader Jeremy Corbyn sparked a row earlier in the week when he urged ministers to halt all arms sales to Saudi Arabia in response to the desert kingdom’s involvement in the war in Yemen.