BAE Systems £5bn Qatar contract becomes effective

BAE Systems said on Tuesday that its contract to supply the state of Qatar with Typhoon and Hawk aircraft is now effective.

The contract, which was signed back in December 2017, is for the supply of 24 Typhoon aircraft to the Qatar Emiri Air Force and a bespoke support and training package that was subject to financing conditions and receipt of first payment.

The contract was amended in June to include the supply of nine Hawk trainers rather than six, and an initial support package.

"These conditions have now been met, and the contract valued at approximately £5bn has become effective with receipt of the first payment today, 18 September," BAE said.

Deliveries of the first Typhoon and Hawk aircraft are expected to begin in 2022.

BAE Systems is the prime contractor for both the provision of the aircraft and the agreed arrangements for the in-service support and initial training.

BAE chief executive Charles Woodburn said: "This contract, effective today, represents a significant step in BAE Systems’ long-term relationship with the State of Qatar, as it becomes the ninth country to choose Typhoon. The proven combination of Typhoon and Hawk will provide the Qatari Armed Forces with the most advanced and flexible multi-role combat aircraft on the market today, along with best in class support and training."

Meanwhile, defence secretary Gavin Williamson said: "This monumental, multi-billion-pound deal is now officially in place, and those from across government and industry who have worked so hard on it together can be extremely proud to see it reach this stage.

"It’s a massive boost to the British defence industry, helping to support thousands of jobs, and it will help us further build the trust between the UK and Qatar to tackle the challenges we both share, support stability in the region and deliver security at home."

At 1530 BST, the shares were up 1.2% to 635.20p.