BAE’s deals as part of the UK arms exports

We have already discussed in several blogs the course of investigation started by the Serious Fraud Office on bribery and corruption in the UK defence conglomerate BAE Systems. Currently there are six inquiries into BAE, the most serious allegations are concerned with BAE’s deals in South Africa. The case with £1bn commission passed through the BVI-registered Red Diamond Trading and Poseidon Trading Investments also catched the attention of the US Department of Justice, which is now seeking to pursue BAE systems.

The enormous scale of BAE’s deals reflects the place of the United Kingdom in the global arms exports and ‘strong defence’ industry. According to the official statistics, Britain is the world’s second-largest arms exporter. On last Monday the non-governmental organization Saferworld published a report where documented the £45bn worth of arms delivered by the UK in the past 10 years.

Among the countries that received military aid from Britain there is Indonesia which used £400m worth of British military equipment for internal repressions since 1997. More than £110m worth of military equipment have been exported to Israel in the period of occupation of Palestinian territories and war with Lebanon. Further, despite an EU arms embargo, Britain exported military and dual-use equipment to China on the amount of £500m.

Another figure: over the past four years, 199 export licences have been approved to the British Virgin Islands, the Cayman Islands and the Channel Islands, which are actually territories without armies. So, it is difficult to know exactly where military equipment passed to these offshore territories is destined.

Three months before his election in 1997, Tony Blair wrote in BAE Systems’ newsletter that his government would champion country’s arms exports. Domestic economic benefits are not the only reason for arms exports. Academic research shows that the public subsidises arms sales by between half a billion and a billion pounds annually. There is also a big influence by big arms corporations, as reflected in the interconnections between them and the Ministry of Defence.

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