German Halt to Saudi Arms Sales Could Put Squeeze on European Fighter Jet

BERLIN—Germany’s hardline halt in arms sales to Saudi Arabia over the killing of Saudi journalist Jamal Khashoggi may jeopardize a big UK-led European fighter jet order from Riyadh.

German Chancellor Angela Merkel has been more outspoken than fellow major arms exporters the United States, Britain, and France about stopping sales to Saudi Arabia until Khashoggi’s case is cleared up, a stance that a senior conservative ally said could also affect previously approved orders.

Berlin is now reviewing all Saudi sales, including contracts approved in September for more patrol boats and four Cobra counter-battery radar systems built by a consortium that includes France’s Thales, Airbus, and the U.S. defense company Lockheed Martin.

German authorities approved more than $450 million worth of Saudi arms supply contracts in the first nine months of 2018, but have not specified the value of equipment not yet delivered.

Germany accounts for just under 2 percent of total Saudi arms imports—a small percentage internationally compared with the United States and Britain—but, crucially, also makes components for other countries’ export contracts.

The biggest impact may be on a $12.9 billion agreement by Saudi Arabia to buy 48 new Eurofighter Typhoon fighter jets from Britain, given that a third of their components would come from Germany, industry sources said.

Nearly four years in the making, the Saudi Eurofighter order would secure thousands of jobs at the aerospace company constructing the aircraft BAE Systems, and help extend production of the European warplanes until a next-generation fighter jet to be designed in coming years goes into production.

Saudi Arabia is also one of the few remaining export markets for the Eurofighter, given the warplane program’s losses to the Lockheed F-35 fighter jet in other tenders, including a decision expected soon from Belgium.

Tough Dilemma

Germany has taken a tougher approach on arms sales to Riyadh following Khashoggi’s killing inside the Saudi consulate in Istanbul, which has stirred international outrage, than major allies such as the United States, France, and Britain.

U.S. President Donald Trump has voiced concern that shelving arms sales to Riyadh could push Saudi Arabia, its key Arab ally against Iran, to place orders with Russia and China.

Tim Stuchtey, executive director of the Brandenburg Institute for Society and Security, said Germany faced a tough dilemma—to follow its moral instincts or pursue a realpolitik-led agenda of arms sales out of economic interest.

Merkel is guided in part by the March 2018 governing accord with her coalition partners, the left-leaning Social Democrats, who insisted on language that bans arms sales to any parties involved in the devastating war in Yemen—where Saudi-led Arab forces intervened in 2015—except for certain previously approved items and those that will remain in the purchasing country.

Divergent views in Europe on the issue also underscore the challenges facing an ambitious Franco-German program to develop a future fighter jet, he said. “As long as we don’t have unified European rules for arms exports, we will always have this problem. It will be difficult to square French and British attitudes about arms exports with German moral imperatives.”

Arising in part from its Nazi past, Germany’s cautious approach to weapons sales, and past moves to slow down approvals for exports, have raised eyebrows in other European countries.

It has already prompted France to market certain weapons as “100 percent French”—not subject to disruption by suppliers in other countries, according to one executive.

Norbert Roettgen, who chairs the German’s parliament’s foreign affairs committee, told broadcaster ZDF that Germany’s credibility was at stake if it did not halt all arms deliveries to Saudi Arabia until the ultimate responsibility for Khashoggi’s killing is established, or serious consequences were seen in Saudi Arabia.

By Andrea Shalal & Sabine Siebold