BAE Systems, the company that was British Aerospace before it became too 'global' for 'British', is the world's fourth largest arms producer. It makes fighter aircraft, warships, tanks, armoured vehicles, artillery systems, missiles, munitions and much more. Its only significant non-military business, the passenger airplane producer Airbus, was sold off in 2006.
These arms are sold indiscriminately around the world and the company thrives on others' insecurity. Its 2005 Annual Report candidly stated that "New threats and conflict arenas are placing unprecedented demands on military forces and presenting BAE Systems with new challenges and opportunities...". The company claims to have military customers in "some 130 countries", with its foremost markets being Saudi Arabia with its "grim human rights situation" and the US, to which BAE Systems has steadily been moving its business. Its purchases of the combat vehicle manufacturers United Defense (Jnne 2005) and Armor Holdings (June 2007) are significant strides in this direction and give BAE a major stake in the US's ground fighting in Afghanistan and Iraq. Other controversial BAE deals include supplying sub-systems for Israeli F-16 fighter aircraft and selling Hawk light combat aircraft to Indonesia during its repression of East Timor.
UK Government support
The UK government provides astonishing levels of political and financial support to BAE. The company had a loyal servant in Prime Minister Tony Blair. In his autobiography, former Foreign Secretary Robin Cook observed "I never once knew number 10 come up with any decision that would be incommoding to British Aerospace". Tony Blair went out of his way to promote arms deals for the company (in Saudi Arabia, South Africa and India) and overruled cabinet colleagues to approve controversial arms export licences (to Tanzania and Zimbabwe).
But the company's political influence is far broader and more engrained than this. It spins the revolving door to provide jobs for influential political and military figures, has executives on an array of high-level government advisory bodies, and dominates the government's arms sales unit – the Defence Export Services Organisation (DESO). This body employs 460 civil servants whose role is purely to sell arms on behalf of companies and to lobby within the UK government for arms exports. It is presently run by a secondee from missile-producer MBDA which is 37.5% owned by BAE, and 40% of DESO staff work on the BAE-run Al Yamamah project with Saudi Arabia.
There appear to be two common features of major BAE arms sales. The first is high level UK ministerial support to clinch the deal. The second is allegations of corruption in the aftermath. Once the Serious Fraud Office (SFO) had begun its investigation with regard to Saudi Arabia in November 2004, its investigation spread, encompassing, at the time of writing, deals with six other countries.
1. Amnesty International, 2006 Report
2. Robin Cook, The Point of Departure, Simon & Schuster, London 2003