Friday, May 20, 2005

UK arms sales and Blair and Thatcher

The UK is ranked second in the world for arms exports behind only the US.

The UK arms industry receives more government support and subsidy than any other.

Arms sales to Indonesia have been underwritten by the British taxpayer to the tune of more than £800 million.

Labour has signed strategic export licences to supply three-quarters of the 40 worst human rights abusing states in the world.(As assessed in Ethical Consumer October/November 1998)

For example, Labour has sold arms to Indonesia, Turkey, Zimbabwe, Sierra Leone, Columbia, India, Pakistan and Morocco.

The UK military export industry is estimated by the government to employ just 0.3% of the total employment market of 28 million jobs.


"The UK government's DTI has underwritten South Africa's purchase of BAE Hawk jets by £1.7bn. This means if the extremely fragile economy of South Africa defaults in payments to the UK, the taxpayer picks up the bill.

Tanzania is one of the poorest nations on earth. Tanzania received £64m from the UK in aid. Almost half of this went straight back into the hands of BAE engineers on the Isle of Wight."


from The Mirror (London) May 29, 2002

John Pilger:

"With nuclear powers India and Pakistan on the edge of war, the role of the Blair government in fuelling the conflict has been critical.

"In the year 2000, the Government approved nearly 700 export licences for weapons and military equipment to both countries. These had a total value of £64million. India, which gets the great majority of British weapons, is building under licence Jaguar bombers that are capable of delivering nuclear weapons.

"In January, as the two countries prepared for war, Tony Blair arrived in the subcontinent on what was called a "peace mission." In fact, as the Indian press revealed, he discussed the opposite of peace - a £1billion deal to sell India 60 Hawk fighter-bombers made by British Aerospace. "The issue of India acquiring the Hawks," reported the periodical Outlook India, 'was raised by Prime Minister Blair with Prime Minister A.B. Vajpayee, defence minister George Fernandes said today."'


"TONY Blair's close links with Israel - many of them forged by his friend, the deal-maker Michael Levy, whom he made Lord Levy - are described as 'the Government's tireless efforts to bring peace and stability to the Middle East.' The opposite is true...

"In the first 14 months of the Palestinian uprising against Israel's illegal military occupation - when the Palestinians' main weapon was the slingshot - the Blair government approved 230 export licences to Israel for arms and military equipment. The licence categories these covered included large-calibre weapons, ammunition, bombs and almost certainly vital parts for American-supplied helicopter gunships. These Apache gunships have been frequently on the news, firing missiles at civilian areas."


In the New Staesman, 31 Jan 2000, Samuel Brittan explained 'Why arms sales are bad for Britain'.

Blair's government sold Hawk aircraft to Indonesia's Suharto and sold Hawk fighter spare parts to Zimbabwe. Saudi Arabia accounts for about one third of British arms sales.

Brittan writes that we should be on our guard when politicians defend dubious policies by declaring "jobs are at stake".

"The argument that jobs derived from exporting weapons cannot be replaced is akin to the argument for keeping open uneconomic coal mines for the sake of employment."

People change jobs constantly. 'It is almost certainly easier for arms workers, many of whom have a wide range of valued skills, to find new jobs than it was for miners, whose training was far more specific.'

"Defence exports", measured by orders rather than sales, are worth around £5-6 billion a year or a little over 0.5 per cent of GDP. The number of workers employed is 130,000.

A cut of one-third would eliminate the most dubious items. This would mean a loss of 0.167 per cent of GDP or just over 40,000 jobs.

If British arms exports were cut by £1 billion or £2 billion a year, the cost could be a small deterioration in the terms of exchange between British exports and imports from overseas amounting to around 0.25 per cent of GDP.

But arms sales are so heavily supported by the taxpayer that there might actually be a gain in moving the workers, plant and technical skills to other activities that could pay for themselves.

The drive for arms sales distorts the design and production plans of British manufacturers and, in the view of some defence economists, offsets the savings in overheads.


"BALFOUR BEATTY was one of the two British firms to win the contract to build the Pergau dam in Malaysia in 1991. Margaret Thatcher's government agreed to fund the project with £234 million of overseas aid.

"Her son was employed as an adviser to the other British contractor, Cementation International. Thatcher's foreign affairs adviser, Sir Charles Powell, became a director of Trafalgar House, which owns Cementation International.

"The subsidy to build the dam was secretly linked to an agreement by the Malaysian government to buy £1,000 million of British made arms.

"The High Court later ruled that the Tory government had illegally used overseas aid to subsidise arms sales."

"In Malaysia, the Pergau dam was built with £234 million of British overseas aid. Documentary evidence subsequently revealed that the aid package was linked in writing to a reciprocal arms deal whereby the Malaysian government agreed to buy over £1,000 million worth of British military equipment in return for the UK funding Pergau.

"A judicial review brought by a British NGO, the World Development Movement, against the Foreign Office led to a High Court ruling that aid for Pergau was in violation of the 1966 Overseas Aid Act, which forbids British aid money being used for the purchase of arms.

"According to project officials, the Pergau dam can only be used at peak energy hours because the volume of water allows the dam to operate for only a few hours. Even the World Bank criticised the project, arguing that it would be more cost effective to build gas fired power stations."


"The day after Lady Thatcher landed in Oman in 1981 to clinch a £300m university construction deal for Cementation, a Trafalgar House subsidiary, the young Thatcher arrived in the desert kingdom and claims were publicly aired that he pocketed payments as an intermediary in the contract. His mother subsequently told the Commons that she was only "batting for Britain"; he issued statements denying any impropriety.

"A similar charge of a conflict of interests was played out after his mother signed the al-Yamamah arms deal with Saudi Arabia and he was alleged, based on transcripts of telephone conversations between Saudi princes and agents, to have enjoyed £12m in commissions."

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