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Press Release

Thatcher Clinched Al Yamamah Arms Deal for Britain

September 2016

Videograb from June 11 Panorama program
BAE Systems was created in 1981, when Prime Minister Margaret Thatcher privatized the British arms industry. In 1985, Prince Bandar flew to London, to confer with Thatcher to arrange the purchase of fighter planes for the Saudi kingdom. There were widespread rumors that Bandar had been recruited by British Intelligence while attending the Royal Air Force College.

Aug. 31, 2016 (EIRNS)—Margaret Thatcher made an unscheduled stop in Riyadh, Saudi Arabia, in April 1985 to give Saudi King Fahd the final push to sign the Al Yamamah arms deal, a £42 billion deal to sell Tornado combat jets and Hawk trainer aircraft, built by arms maker BAE Systems, that later gave rise to charges of bribery and financing of terrorism. According to British press accounts of Aug. 23 and 24, documents newly released by the British National Archives show that Thatcher made a hastily arranged visit to Riyadh while on her way back from a trip to Asia, a visit that could only have had one purpose, to nail down the Tornado deal.

The visit, which came in response to a personal invitation by Prince Bandar, the Saudi ambassador in Washington at the time, was supported by Defense Minister Michael Heseltine and other officials of the Thatcher government on condition that it produce a Saudi decision to go forward with the BAE deal.

BAE Systems office in Arlington, Virginia, U.S.A.
BAE Tornado fighter jet flying over Iraq.

"To date, we only have Prince Bandar’s word for it that the King has decided to buy Tornado. We need to get this made more precise and more explicit,"

read a Foreign Office memo to Downing Street. "Tackling the King in person is probably the only way of smoking the Saudis out."

At the same time, others among Thatcher’s aids were scheming about how to hide the real purpose of the visit from the British public. An official record of the meeting between Mrs Thatcher and King Fahd on April 14, 1985, made no mention of either Tornados or an arms deal, reports the Independent. But in a letter to the King the following day, the Prime Minister mysteriously wrote:

"I was glad that we were able to discuss a further matter privately over lunch. I look forward to receiving your majesty’s personal envoy soon, in order that we may conclude this matter successfully."

The BAE deal was signed the following September, with the first jets delivered in 1986.

But, as EIR documented in its June 22, 2007 issue, the real nature of the AL Yamama deal, goes well beyond the bribery charges that were the subject of an investigation by Britain’s Serious Fraud Office in 2006, an investigation that was subsequently shut down by Tony Blair. Al Yamamah was actually a barter deal by which the Saudis paid BAE for the jets by sending a super-tanker load of oil to Britain every day for the life of the deal. The oil was then sold on the spot market by Royal Dutch Shell and British Petroleum. By EIR’s estimates, the barter deal netted some $160 billion off the books for the British and their Saudi partners, creating the world’s largest slush fund devoted to the clandestine wars and Anglo-American covert operations over, now, three decades.