Secret £1bn deal to insure BAE Saudi contract

How does a deal like this come about? How could this possibly be in the public interest?

Corporate control in the halls of power is ever increasing and continually consolidating. Their lobbying efforts, their political ‘support’, their buying of politicians – these are all the necessary outcomes of capitalism, a system that rewards greed.

The government’s willingness, that is a result of our faux democracy that allows most people to experience a few seconds of ‘choice’ every four years.

We should stand up and oppose both corporate/capitalist control, and government complicity.

The government has secretly agreed to pay the arms firm BAE Systems £1bn in the event that the Saudi regime, one of the company’s main military customers, collapses.

The insurance arrangement, which is not detailed in any public documents, has been made through the Department of Trade and Industry’s export credits guarantee department (ECGD). If the Saudi royal family falls and a successor refuses to pay its debts, BAE, which is under corruption investigation in London, will be compensated by the government. The UK Treasury is already burdened by a string of other foreign bad debts.

The Saudis are committed to handing over £1bn-worth of oil every year to BAE, in return for the firm virtually running the Saudi air force.

BAE has nearly 5,000 staff inside the country, and the Saudi income is crucial to the fortunes of Britain’s biggest arms company. It is believed to provide more than 20% of its profits. But Saudi willingness to continue paying came into question last week, when BAE unexpectedly warned of a reduction in future Saudi profits thanks to what was described as a decision to have greater “local content”.

The company is under investigation by the Serious Fraud Office over allegations that a £60m…

Posted by troy
I'm a PhD student at York University in the Social and Political Thought program. After two degrees in Economics that failed to convince me that capitalism is a system that truly works for the benefit of all, I am trying to expand my knowledge. I hope to...