Russia Says It's Ready to Arm Saudi Arabia

Lyuba Pronina, Staff Writer Moscow Times February 10, 2005 No. 3103
[From David Isenberg's Weapons Trade Observer,
http://lists.topica.com/lists/sento]
[With thanks to www.mideastweb.org/mewnews1.htm ]

Moscow is preparing its first major defense contract with Saudi Arabia, the
world's largest arms buyer that has traditionally spent its petrodollars on
U.S.-made weapons. The deal is part of a strategy aimed at diversifying
Russia's arms buyers away from China and India, Sergei Chemezov, general
director of state-owned arms exporter Rosoboronexport, told reporters
Wednesday.

Russia also signed an arms contract with Morocco last month, he said, the
first since the breakup of the Soviet Union.

Chemezov refused to give any details, but said that Russia is stepping up
negotiations with Middle Eastern countries for jointly developing air
defense systems on the basis of the domestically produced S-300, Buk and
Tor-M1 systems.

"If a contract with Saudi Arabia is signed, it will be a landmark event in
Russian arms exporting," said Marat Kenzhetayev, an expert with the Center
for Arms Control.

From 1991 to 2002, Saudi Arabia imported $ 93 billion worth of weapons,
Kenzhetayev said, while Morocco imported $ 1 billion.

In that same period of time, Riyadh signed $ 40 billion worth of arms
contracts, of which $ 28 billion flowed to the United States and not a penny
went to Russia, he said.

After U.S.-Saudi relations dampened following the Sept. 11, 2001, terrorist
attacks, the situation now seems to be swinging in Russia's favor,
Kenzhetayev said.

While Moscow already sells arms to Middle Eastern countries such as the
United Arab Emirates, Yemen, Iran, Kuwait and Algeria, a deal with the
Saudis could push its neighbors Jordan and Oman to sign Russian contracts as
well, Kenzhetayev said.

For Moscow, which sells arms to 59 countries, finding new customers is
important as it tries to diversify away from major clients China and India,
which account for 80 percent of Russian arms sales.

"We have reached the ceiling of $ 5 billion to $ 6 billion in annual arms
sales abroad," Chemezov said. "We have to change something drastically."
Last year, Rosoboronexport, which mediates over 90 percent of the country's
arms deals, delivered $ 5.1 billion worth of arms out of $ 5.8 billion
exported by Russia as a whole.

Rosoboronexport has orders of $ 12 billion through 2007, but Chemezov said
that this year Rosoboronexport can expect to make $ 1 billion less in
revenues.

"The reason? Our companies cannot produce more modern weapons. The industry
is in need of investment either from private companies or from the state,"
he said. "Today we sell weapons that were designed in the late 1970s and
early 1980s." Rosoboronexport plans to boost control over defense production
by placing its directors on the boards of arms makers and buying stakes,
Chemezov said.

Chemezov said that all sales are strictly in line with international
agreements and do not violate any United Nations sanctions.

"However, if some country, including the United States, makes its own
decision on sanctions , pardon us, we are not obliged to do as America
says," Chemezov said.

Last month, Israel and the United States expressed concern about the
possible sale of SA-18 surface-to-air missiles to Syria.

Asked whether any such contract was discussed during Syrian President Bashar
Assad's recent visit or is planned, Chemezov said: "No."