Saudi's Supply of Rheinmetall Military Trucks Hinges on Germany's Approval

Saudi’s €136 million ($154 million) order for Rheinmetall’s military trucks will be concluded very soon, provided Germany gives an approval for export licence of the same.

Germany announced a freeze in arms sales approvals to Saudi Arabia and urged its fellow European Union (EU) members to do the same over Riyadh’s admittance that its security team killed journalist Jamal Khashoggi last October.

"Germany has to make a decision. It is not necessary to sue the government since Germany has determined the compensation Rheinmetall would be entitled to. According to the law, I would be allowed to deliver the trucks today," Rheinmetall CEO Armin Papperger was quoted as saying by Reuters.

Berlin will take a decision regarding the extension of the embargo before the end of March, the report stated further.

Germany and Spain have in the past called for a stoppage of arms sales to Riyadh over its bombings of civilian targets in Yemen but have not followed through on their threats in the face of large defence orders from Saudi Arabia which is the world’s biggest arms importer.

Germany’s halt in exports to Saudi Arabia has also prevented Britain from completing the sale of 48 Eurofighter Typhoon fighters worth €10.5 billion ($12.82 billion) to Riyadh, and has delayed potential sales of other weapons such as the A400M military transport, a top Airbus official told Reuters last month.

Saudi Arabia bought nearly €150 million ($170 million) worth defence hardware from Germany in 2017 in the form of four patrol boats and 110 military trucks. In comparison, Spain secured a € 2 billion ($2.26 bilion) deal to sell warships to Riyadh that year.

Although there are uncertainties involving defence deals with Saudi, the German firm reported a 40 percent rise in full-year profit driven by growth in its defence business. Rheinmetall said its defence division, with a record order-book worth €8.57 billion ($9.7 billion), helped lift net profit to €354 million ($401 million).