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UK firms make huge profits on arm sales to Saudi Arabia

Arms sales to Riyadh exceed $8bn, while UK government receives just $40m of corporate tax, War Child report says.

War in Yemen

British companies selling weapons have earned hundreds of millions of dollars by selling arms to Saudi Arabia during the ongoing war in Yemen, a report says.

New estimates released by the children's charity War Child reveal that since the Saudi-led coalition began its intervention in Yemen, UK weapons companies including BAE systems and Raytheon have earned revenues exceeding $8bn from dealings with Saudi Arabia, generating profits estimated at almost $775m.

The UK government, however, has received just $40m of corporate tax, the report said.

"This tax revenue figure is pitifully small and comes at the cost of thousands of children who have been killed, injured, and starved by a conflict that this trade has helped sustain," the report said.

A Saudi-led military coalition was formed in March 2015 to support Yemen's internationally recognised government in fighting the Iran-backed Houthi rebels. 

The conflict has killed more than 10,000 people and has injured more than 40,000 to date, according to the United Nations.

In the past three years, the UK has approved arms export licences to Saudi Arabia worth $4.7bn, including the Tornado aircraft, which is partially manufactured by BAE systems, vehicles and tanks, including BAE's Tactica armoured vehicles valued at $580,000 and $1.48bn worth of grenades missiles and bombs.

Since then, Saudi Arabia has been involved both directly and indirectly in the conflict in Yemen, where it faces accusations of war crimes and other abuses.

The report argues that the policy of selling arms to Saudi Arabia is financially inconsistent and does not "represent good value for money".

The UK reaps a minimal tax take from arms sales in Saudi Arabia - just $18m in corporation tax in 2016 - yet, the will spend $187m in humanitarian aid to Yemen, according to War Child. 

"The arms trade directly counteracts much of the benefits Yemeni children and other civilians might expect to receive from the provision of aid, undermining the Department for International Development's policy of getting value for money from the aid it commits," the report said.


In July, Campaign Against Arms Trade (CAAT) lost a high-profile case calling for UK arms sales to Saudi Arabia to be stopped over humanitarian concerns.

The High Court ruled that there had been extensive political and military engagement with Saudi Arabia regarding the conduct of operations in Yemen and the Saudis had "sought positively to address concerns about international humanitarian law".

Days after the court ruling, the British government licensed $321m worth of arms sales to Saudi Arabia in the six months after an air raid by the Saudi-led coalition killed 140 people at a funeral in the Yemeni capital Sanaa. 

The country is also facing a health crisis, with more than 2,000 people having died from cholera since April, more than half a million people infected, and another 600,000 expected to contract the infection this year.

Aid groups have also accused Saudi Arabia of blocking needed assistance and goods from areas that are most in need. 

Saudi Arabia and its allies have said they aim to prevent arms shipments to the Houthis, but aid groups say the curbs have deepened the suffering of millions.

The coalition has repeatedly been criticised for civilian casualties. Human Rights Watch accused it on Tuesday of war crimes, saying air raids that hit family homes and a grocery store were carried out either deliberately or recklessly, causing indiscriminate loss of civilian lives.

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