A deal to sell Typhoon fighter jets to Qatar will require "unprecedented" support from the British taxpayer, a government document has warned.
Treasury officials expressed concern that underwriting the £6 billion deal risked “billions of Exchequer funding” if Qatar defaulted on the agreement.
The worries stem from an agreement Britain signed with Qatar in December to sell the Gulf nation 24 of the supersonic jets, along with a package of weapons, pilot training and maintenance.
Their assessment was that the transaction amounted to an unprecedented level of support to one buyer and risked “skewing” the portfolio of UK Export Finance (UKEF), the government’s credit agency, “by concentrating about 25 per cent of their portfolio risk in one transaction”.
British defence giant BAE Systems led the sales campaign and will build the jets at its plant in Lancashire, securing thousands of skilled jobs working on the aircraft and in the supply chain. Final terms of the deal are thought to be imminent but it has yet to be fully agreed.
However, a leaked Treasury document revealed fears about the sale and showed ministerial direction had been sought “on national interest grounds”. (end of excerpt)
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