Saudi Arabia Tops Italy's Arms Sales

10.04.2010 KSA

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Italy's arms exports jumped by 61.3% to 4.9 billion euros in 2009, newly released government figures show, thanks mainly to a hefty contribution from the sale of Eurofighter jets to Saudi Arabia.
Although the Eurofighter deal with Saudi Arabia was brokered by the U.K. government, Italian industry has a share in proceeds thanks to Italy's workshare on program, alongside Germany, Spain and the U.K.

The Italian government's annual report on defense sales does not specify the exact value of the work obtained by Italy on the Typhoon contract, but notes that Saudi Arabia leapt to become Italy's No. 1 export destination, worth 1.1 billion euros in sales. Italy's main Eurofighter contractor, Alenia Aeronautica, was the country's top exporter, worth 1.55 billion euros, 23% of all exports.

Saudi Arabia's top ranking, as well as the overall leap in Italian exports, is due to the Typhoon contract, the report stated.
Defense exports overall were up from 3 billion euros in 2008, which in turn were up 29% over 2007. That figure was pushed by AgustaWestland's sale of A129 helicopters to Turkey, which accounted for half the 2008 total. The 2007 total showed an increase of 9% on 2006.
The figures reflect export licenses for products released by the Italian government in any given year.

The numbers do not include material exported for use in intergovernmental programs in which Italy is a partner. Licenses granted for intergovernmental program exports totaled 1.82 billion euros last year, down on 2.69 billion euros in 2008.

Eurofighter is one such program, although the Saudi work is considered separately, as a commercial export, since the Gulf country is not among the original governmental partners on the Eurofighter program.
The report reveals that 1,692 definitive export licenses were issued last year for commercial and intergovernmental programs, of which 94 percent were for exports worth less than 10 million euros, combining for a total value of just over one billion euros, or 16 percent of the value of Italy's total exports.

At the other end of the scale, 22 licenses were for exports worth over 50 million euros, between them worth a total of nearly four billion euros, or 59 percent of total value of exports. In 2008 exports worth over 50 million euros totaled only 1.59 billion euros. The change "indicates a relevant increase on 2008 and a real capacity to operate in the sector as a systems integrator", the report states.
In the company rankings for 2009, helicopter firm AgustaWestland takes second place after its Finmeccanica stablemate Alenia, with 985 million euros in export licenses granted, 14.6 percent of the total. Propulsion firm Avio is third with 811 million euros, then shipyard Fincantieri with 271.5 million euros.
The table for destinations, which does not count intergovernmental programs, places Saudi Arabia as the top destination with 1.1 billion euros, or 16.4% of the total, followed by Germany with 553.5 million euros, the U.S. with 495.4 million euros, the U.K. with 379.6 million euros, Qatar with 317.3 million euros and India with 242.8 million euros, the latter total thanks in part to Fincantieri's sale of a logistics vessel.

The report also lists licenses granted for armaments imports into Italy. In 2009 the licenses total 1.17 billion euros. The U.S. accounts for 711.8 million euros worth of the imports, with the remainder mostly hailing from NATO and European nations, with the exception of 10.8 million euros in imports from Israel and 5.1 million euros from Switzerland.

Apart from listing licenses granted, the report also lists the armaments exports delivered, which rose to 2.2 billion euros from 1.77 billion euros in 2008. Likewise, imports delivered totaled 130 million euros, up from 57.9 million euros in 2008


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