U.S., Saudi Sign Boeing F-15 Fighter Deal Proposed in 2010
January 10, 2012, 12:06 AM ESTBy Tony Capaccio
(Updates with White House comment in second paragraph and economic impact in last paragraph.)
Dec. 29 (Bloomberg) -- The Obama administration has signed with Saudi Arabia an agreement Congress approved in 2010 to sell Boeing F-15 fighters to the Gulf ally, a White House spokesman said.
“Valued at $29.4 billion, this agreement includes production of 84 new aircraft and the modernization of 70 existing aircraft as well as munitions, spare parts, training, maintenance and logistics,” the White House’s principal deputy press secretary, Josh Earnest, said in an e-mailed statement. “These F-15SA aircraft, manufactured by The Boeing Company, are among the most sophisticated and capable aircraft in the world.”
The final cost of a foreign military sale normally is below the potential value notified to Congress.
Saudi Arabia’s last significant U.S. weapons purchase was for 72 F-15s in 1992, a transaction valued at as much as $9 billion. The final installment of those planes was delivered in November 1999.
Saudi Arabia, the world’s biggest oil supplier, used F-15s and Apache helicopters in late 2009 to fight Muslim Shiite rebels who crossed the border from Yemen and seized territory inside the kingdom.
The U.S. and Saudi Arabia have joined in opposition to Iran’s nuclear program. Iran this week threatened to block the Strait of Hormuz, the shipping channel for most of the oil from the Persian Gulf region, if economic sanctions are increased.
“This agreement reinforces the strong and enduring relationship between the United States and Saudi Arabia, and demonstrates the U.S. commitment to a strong Saudi defense capability as a key component to regional security,” Earnest said.
There also would be 50,000 American jobs added and $3.5 billion in annual economic impact to the U.S. economy, Earnest said, citing unnamed industry experts.
--With assistance from Hans Nichols in Honolulu. Editors: Steven Komarow, Leslie Hoffecker
To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net
To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net
