Five questions answered on the BAE Systems and Oman contract

BAE wins a deal.

British aerospace company BAE Systems has won a substantial fighter-jet contract with the Sultanate of Oman. We answer five questions on BAE’s Oman contract.

What is the contract for?

Europe’s largest defence contractor BAE Systems has signed a contract with the Sultanate of Oman to supply 12 Typhoon fighter jets and eight Hawk Advanced Jet Trainer aircraft, as well as in-service support. Manufacturing will begin in 2014 with delivery expected in 2017.

How much is the contract worth?

The contract is worth a staggering £2.5 billion.

What does this contract mean in the long term for BAE Systems?

Earlier in the year BAE Systems seemed to be struggling after it failed to close a merger deal with European defence company EADS. Other blows to the company include the US defense budget, where it derives 40 per cent of its earnings, being cut by $600bn (£369bn) and this week the news that it’s contract with Saudi Arabia  for 72 Typhoon fighters has been delayed because of disagreements over the final contract price.

This latest deal will provide a much needed boost to the company and help safeguard 6,000 high-technology and engineering jobs across sites at Warton and Samlesbury in Lancashire, and at Brough in East Yorkshire.

What has BAE Systems said about the deal?

BAE said in statement: "This contract is further recognition that both Typhoon and Hawk are leading aircraft in their class."

What are other people saying about the contract?

According to the BBC Prime Minister David Cameron welcomed the deal, saying:

"It's testament to Britain's leading aerospace industry and the deal will safeguard thousands of jobs across the UK, not just at the BAE Systems factories in Lancashire and East Riding in Yorkshire, but at many more small businesses up and down the country that play a vital role in delivering these aircraft.”

BAE Systems has won a substantial fighter-jet contract with the Sultanate of Oman. Photograph: Getty Images

Heidi Vella is a features writer for Nridigital.com

Photo: Getty
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Cabinet audit: what does the appointment of Liam Fox as International Trade Secretary mean for policy?

The political and policy-based implications of the new Secretary of State for International Trade.

Only Nixon, it is said, could have gone to China. Only a politician with the impeccable Commie-bashing credentials of the 37th President had the political capital necessary to strike a deal with the People’s Republic of China.

Theresa May’s great hope is that only Liam Fox, the newly-installed Secretary of State for International Trade, has the Euro-bashing credentials to break the news to the Brexiteers that a deal between a post-Leave United Kingdom and China might be somewhat harder to negotiate than Vote Leave suggested.

The biggest item on the agenda: striking a deal that allows Britain to stay in the single market. Elsewhere, Fox should use his political capital with the Conservative right to wait longer to sign deals than a Remainer would have to, to avoid the United Kingdom being caught in a series of bad deals. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.