Saudi Arabia has confirmed it is to buy 72 Eurofighter Typhoon aircraft from the UK, in a deal that could be worth more than £6bn.

The contract, brokered between the Saudi government and the Ministry of Defence, will safeguard thousands of jobs at UK defence firm BAE Systems.

Saudi Arabia is buying the Eurofighters to replace its range of Tornado jets which were also made by BAE.

The Eurofighter was developed by BAE with European firms EADS and Alenia.

Confidential figure

“The required commercial principles have now been agreed which has initiated the purchase of Typhoon aircraft and the associated commitment to the industrial plan to be launched,” said the Ministry of Defence.

The ministry added that as the financial details of the deal were confidential, it could not reveal exactly how much it was worth.

Some newspaper reports have suggested it could total as much as £10bn.

The Eurofighter’s UK headquarters is at Warton, Lancashire, where BAE employs 9,000 people in its aircraft division.

Confirmation of the Saudi deal, which was first proposed in December, saw BAE’s shares close 2.64% higher in Friday trading in London.

Criticisms

Yet while the announcement is welcome news for UK business, it will inevitably attract criticism from those who say UK defence companies should not do business with Saudi Arabia because of the Saudi government’s poor record on human rights and democracy.

Pressure group Campaign Against Arms Trade criticised the deal, claiming that while it had been subsidised by UK taxpayers, the Ministry of Defence and BAE had “failed to demonstrate any gains for the British public”.

“The real beneficiary is the oppressive regime in Saudi Arabia, one of the world’s worst abusers of human rights,” it added.

The 72 planes will be assembled by BAE in the UK from parts made by all the partners in the Eurofighter project.

BAE itself makes the front and rear fuselage, while European defence consortium EADS and Italy’s Alenia build the wings.

Long delays

The Saudi deal is the first confirmed order for the Eurofighter to come from outside the European Union.

Inside Europe, the plane has been ordered by the UK, Germany, Spain, Italy and Austria.

The development of the Eurofighter has been hit by rows and delays, and the project going significantly over-budget.

With work first starting in the early 1980s, the maiden flight did not take place until 1994.

The plane is in competition with the French Rafale.

Source: news.bbc.co.uk

Managers at the world’s largest privately-owned copper mine, Chile’s Escondida, have suspended operations as a strike enters its 12th day.

Escondida said it had shut down work because striking staff had blocked access roads to the mine for two days, causing a health and security risk.

The firm, which is majority owned by global giant BHP Billiton, also said it had broken off talks with the union.

Union staff at the mine are striking in a dispute over pay.

While their picketing is continuing, earlier this week the workers appeared to soften their stand, cutting their pay rise demand from 13% to 10%.

Managers are continuing to only offer 3%.

Prices rise

Escondida, which had claimed that it was producing more than half its usual output during the strike, said it had no choice but to temporarily halt production.

“The company wants to maintain its operational continuity and renew operations as soon as possible, as soon as the police can insure the full safety of people who work in the company,” it said in a statement.

The Escondida mine produces 8% of the world’s copper, and the strike has caused already high copper prices to rise still further.

In early Friday trading, copper prices were up 2.5% on Thursday’s close.

Copper prices have hit record highs this year - due to strong global demand led by China - and this is the main reason why workers at the mine say they deserve a substantial pay rise.

In addition to BHP Billiton’s 57.5% stake in Escondida, its global mining rival Rio Tinto holds 30%.

Source: bbc.co.uk

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