UN arms embargo on Libya to cost global arms industry billions

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A United Nations Security Council arms embargo imposed on Libya on Friday could cost global defence manufacturers billions of dollars, depending on how long it lasts, whether Moammar Gadhafi’s regime survives or if a future post-strongman government honours the deals signed since a previous terrorism-related embargo was lifted in 2003.

Agence France Presse (AFP) reports Russia could lose almost US$4 billion in arms export contracts to Libya, while Italy faces a hold on deals worth US1 billion. AFP reports the Interfax news agency quoted a military source as saying that Russia had confirmed orders worth US$2.0 billion while negotiations had been in progress for deals adding up to US$1.8 billion more. “Among the countries of the Middle East and North Africa, Libya is one of the main buyers of Russian weapons,” the source, which was not identified, told the agency.

Another report last week said Russia could lose a total of up to US$10 billion in arms sales from the wave of unrest currently destabilising regimes in north Africa and the Middle East, AFP added. Without confirming the figures, Defence Minister Anatoly Serdyukov confirmed Moscow was deeply troubled by the potential impact of the Arab revolts on its weapons exports. “We are really alarmed by this. We would like contracts that were signed and (military) arrangements to be implemented,” Serdyukov said in the city of Orenburg.

The Interfax source recalled that Libyan Defence Minister Yunis Jaber had gone on a major spending spree during a January 2010 visit to Moscow, signing 1.3 billion euros worth of deals including for six Yak-130 fighter-trainers. Libya had also been expected to become the first foreign buyer of Russia’s new Sukhoi Su-35 fighter and a contract worth US$800 million for 12-15 planes had been ready for signing, the source said.

A range of other contracts for helicopters and missile systems were also being discussed. Libya had also shown great interest in Russia’s new S-400 missile defence system, its T-90S tanks, submarines and rocket launchers, the source said. The Soviet Union had delivered a huge amount of military hardware to Libya before the collapse of the USSR, including 350 fighter jets between 1981 and 1985 as well as 4,000 military vehicles and tanks.

Further west, the German Deutsche Welle radio reported European Union figures showed that in 2009 member states granted export licenses worth 343 million euros to Libya. Italy approved exports worth 112 million euros, largely in the form of military aircraft. Malta was second on the list after it authorised the resale of a 79 million euro consignment of light and small arms originating from Beretta in Italy. Germany was third on the list, with 53 million euros of licenses, mostly for electronic jamming equipment that may presently be the cause of the mobile phone and Internet communications disruptions in the country.

AFP notes missile systems maker MBDA Italia signed a deal worth 2.5 million euros in May 2009 to supply Libya with “material for bombs, torpedoes, rockets and missiles,” according to an Italian interior ministry report. Helicopter maker AgustaWestland signed two contracts with Libya in October 2010 worth 70 million euros. Also last year, Selex Sistemi Integrati signed a 13 million euro deal to provide Libya with gun targeting equipment. Artillery company Oto Melara reportedly last November also begun talks with Libya in November 2010 for “weapons or weapons systems with a calibre of more than 12.7 mm, as well as material, spare parts, know how and equipment.” This year military shipmaker Intermarine Spa started negotiations with Libya for contracts worth a total of 600 million euros.



Deutsche Welle adds YouTube footage posted in Belgium allegedly showed semi-automatic FN 303 anti-riot guns seized by anti-Gadhafi protesters. They were reportedly supplied by FN Herstal in a 11.5 million euros deal that included rifles, pistols, rifle grenades and ammunition. The radio station adds that in 2008 Britain blocked a license to ship 130 000 Kalashnikov assault rifles to Libya because of fears they could be resold to warlords in Sudan, but in the same year, Romania sold Gadhafi 100 000 of the guns.