October 09, 2015

France signs deals worth $10 billion with Saudi Arabia

Valls expects additional deals to be finalised

PARIS - France on Tuesday announced a series of deals worth 10 billion euros ($11.4 billion) with Saudi Arabia, reinforcing growing ties between the two countries.

Prime Minister Manuel Valls announced the deals, some still to be finalised, on Twitter during a visit to Riyadh.

He said they showed that his government was "mobilised for our companies and employment".

The agreements include contracts and letters of intent between the two countries, whose economic and political ties have grown under President Francois Hollande.

One agreement was a Saudi order for 30 patrol boats, while another will create a Saudi fund for investment in small- and medium-sized French businesses.

The lifting of an embargo on French beef, imposed over "mad cow" disease, will allow 37 French firms to resume exports to the Gulf kingdom, Valls' office said.

Other deals under discussion could cover telecommunications and surveillance satellites, urban transport and energy.

France is the third-largest investor in Saudi Arabia, and Valls said he expects additional deals to be finalised.

"We don't doubt for one instance that these letters of intent will be confirmed," said Valls.

The announcements came during the third high-level visit this year by French officials to the world's largest oil exporter.

France has boosted ties with the conservative Islamic kingdom -- the Arab world's largest economy -- despite persistent criticism from rights activists of its record on civil liberties.

For Saudi Arabia, expanding ties with France are part of an effort to build alliances beyond its traditional defence partner the United States, to counter Riyadh's regional rival Iran.

Valls late on Monday opened a forum to promote commercial ties between French and Saudi firms.

He is on a regional tour which has already taken him to Jordan and Egypt, along with Defence Minister Jean-Yves Le Drian.

Foreign Minister Laurent Fabius is also in Riyadh.

Hollande visited in January to pay his respects after king Abdullah died, and in May returned to become the first Western leader to attend a Gulf Cooperation Council summit.

The order for patrol boats is the latest in a series of weapons deals Paris has made in the region this year.

On Saturday, Egypt signed a deal with France to buy two Mistral warships originally ordered by Russia.

According to French government sources, Egypt will pay 950 million euros, with "significant" financing from Saudi Arabia.

France this year also sold 24 Rafale warplanes to Egypt and Qatar.

In Cairo, Valls highlighted joint efforts against extremism, saying: "We all have a common enemy -- Daesh."

He was using an Arabic acronym for the jihadist Islamic State group which has seized territory in Syria and Iraq, where it has carried out widespread atrocities, and inspired attacks elsewhere.

Both France and Saudi belong to the US-led coalition that has bombed ISIS which has also claimed responsiblity for attacks in the kingdom this year.

Riyadh and its Sunni-dominated neighbours accuse their Shiite regional rival Iran of meddling in Iraq, Syria, Lebanon and Yemen.

Since March, Riyadh has led an Arab coalition backing local Yemeni forces, first with air strikes and now also with ground troops, against Iran-supported Huthi rebels who had seized much of Yemen.

Human rights watchdogs have repeatedly criticised the coalition's aerial bombardment of Yemen, saying they had hit with no military targets.

French aid agency Action Against Hunger (ACF) on Monday said Valls's visit seemed to favour negotiating contracts, notably military ones "with a powerful economic ally", instead of looking for diplomatic solutions to the war in Yemen where civilians are suffering.

The French delegation was discreet on the subject of human rights, but Valls told reporters he had "called for clemency" for Ali al-Nimr, a member of the minority Shiite community facing the death penalty.

Nimr was just 17 when arrested in February 2012 after taking part in pro-reform protests, and his case has raised international concerns.

1