News & Politics

4 U.S. Companies Getting Rich Off Gulf Arab Conflict With Iran

They're are striking contracts with the Department of Defense to supply missiles, helicopters and fighter jets.

In mid-May, President Barack Obama hosted top officials from Gulf Arab states at Camp David, the idyllic presidential retreat in Maryland. The meeting was designed to assure Gulf Arab leaders that the U.S. still has their back, even though the Obama administration is hurtling full-speed ahead toward a landmark nuclear deal with Iran.

Many of the monarchs from the Gulf decided to snub Obama by not showing up for the retreat. Instead, they sent other top officials, a way of showing their displeasure at the impending nuclear deal with Iran, the state they have been battling over Middle East hegemony for years. Despite the snubs, the Obama administration announced at the summit that there will be more security assistance and expedited weapons sales for Gulf Arab states as a way of ensuring their strategic position against Iran.

That promise of more arms is not surprising. In recent years, the Gulf states, flush with oil wealth, have bought massive amounts of American weapons. Since 2010, Gulf Arab states have increased their armaments purchases by 70 percent. Leading the pack is Saudi Arabia, which in 2014 became the world’s largest importer of American-made weapons. One out of every seven dollars spent on weapons in the world comes from the Saudis, according to the IHS’ yearly Global Defence Trade Report.  The Obama administration has overseen the sale of over $64 billion in weapons and defense systems to Gulf nations.

In the past, weapons sales to Gulf Arab nations have been held up because of Israeli concerns over their “qualitative military edge,” the notion that Israel should maintain superior military capabilities over their Arab nations. But that reticence to sell weapons to states like Saudi Arabia has eased in recent years because Israel and the Gulf states share a common interest in boxing in Iran.

For the most part, arms sales are designed to beef up militaries in anticipation of any conflict with Iran. But in the past year, the Gulf states have flexed their muscles by joining the U.S.-led coalition against the Islamic State, and by pounding Yemen with bombs, leading to a humanitarian catastrophe. The flow of arms sales is further militarizing a region already rife with bloody conflict stretching from Syria to Yemen. The result is human misery.

But the Gulf States’ purchases are making one American industry very happy. U.S. arms companies are striking contracts with the Department of Defense to supply states like Saudi Arabia, the United Arab Emirates and Qatar with missiles, helicopters and fighter jets. Here’s a look at four U.S. arms companies getting rich off the Gulf States’ fear of Iran.

1. Boeing. This Illinois-based aerospace company makes aircraft and helicopters designed to be used in military conflict. Members of the Gulf Cooperation Council, the six-nation consortium of Gulf states, have been frequent Boeing customers.

Earlier this year, the United Arab Emirates announced it would be spending $618 million on two C-17s, a large military transport aircraft made by Boeing. This purchase was in addition to one made in 2009, when the company was awarded a contract to supply the United Arab Emirates with six C-17s. In 2010, Boeing made nearly $700 million by supplying Kuwait with a C-17.

In 2013, Boeing received part of a $10 billion contract to give Saudi Arabia and the UAE high-tech missiles that can be launched from airplanes over 135 miles from the target. Two years before that deal, Boeing was awarded a $29.4 billion contract to supply Saudi Arabia with 84 F-15 fighter jets and upgrade older aircrafts.

Boeing is also the creator of the Apache attack helicopters. The biggest weapons deal of 2014 was a $23 billion agreement with Qatar, in which Boeing will supply 24 Apache helicopters to the small nation. Other weapons firms were also involved in the agreement.

2. Raytheon. This company is best known for manufacturing missiles. Raytheon has won a number of contracts to supply Gulf states with high-tech missiles.

In 2013, Raytheon was given a $1 billion contract to supply Saudi Arabia with 15,000 anti-tank missiles. Middle East analysts saw the move by Saudi Arabia as connected to their support for Syrian rebels battling against the Assad regime. While it’s against U.S. law for American-made weapons to go to an unauthorized third party, Middle East observers said it’s possible the Saudis were shipping old stocks to the rebels and replenishing their own with U.S.-made weapons.

Raytheon also struck gold in 2012 when it won a deal to supply the Saudis with a $600-million Command, Control, Communications, Computers and Intelligence (C4I) system, a centralized decision-making system.

The Saudis are not the only ones handing over cash to Raytheon. The company was included in the massive $23 billion deal with Qatar in 2014. It is supplying the country with Patriot missiles—a defense missile that shoots down other missiles—valued at $1.7 billion. Raytheon also won a contract in 2008 to supply the UAE with Patriot missiles, which will net it $3.3 billion. And in 2013, Oman announced it would be giving Raytheon over $2 billion for a ground-based defense system designed to counter air attacks.

3. Lockheed Martin. This company is another major player in the U.S. weapons industry. In 2013, the company inked a deal with the UAE to build them a defense system called Terminal High Altitude Area Defense, meant to combat missile strikes. Lockheed nabbed $3.9 billion for the deal, which also included armaments for the U.S. military.

The company has had extensive dealings with Oman. In 2011, it inked a $600 million deal to supply the Gulf state with 12 fighter planes.

And like other companies, it has also profited from sales to Saudi Arabia. It won a $22 million deal in 2014 to give the Saudis specialized support for Apache helicopters. The deal includes deliveries of equipment for “long range precision engagement” and flight safety for the helicopters. In 2013, the company, alongside Northrop Grumman, received a $90 million contract to supply the Saudis with a radar system for the Apache helicopters the Saudis possess.

4. Sikorsky Aircraft. This subsidiary of United Technologies makes Black Hawk helicopters, another type of military helicopter. It has delivered the Black Hawks to Gulf Arab states. In August 2014, the company won a $30 million contract to supply Saudi Arabia with 12 Black Hawks. In 2011, Sikorsky Aircraft netted $270 million to upgrade the UAE’s supply of Black Hawk helicopters.

Earlier this year, Reuters reported that the company is looking to sell 400 helicopters to Middle Eastern countries over the next five to 10 years.

 

 

Alex Kane is former World editor at AlterNet. His work has appeared in Mondoweiss, Salon, VICE, the Los Angeles Review of Books and more. Follow him on Twitter @alexbkane.

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