Besides going to Saudi Arabia to create an Arab NATO and to exhort the Sunni Arab states to reject jihadism and to join the war on terror, President Donald Trump went prepared to do business. Not only did the president sign a $110 billion arms deal ($350 billion over ten years) but facilitated $50 billion in business with American companies that will have a profound impact on the United States economy.
Saudi Arabia and the other Gulf States want to diversify from oil and gas
Trump is taking advantage of a desire by Saudi Arabia and the other Arab Gulf States to diversify their economies from Oil And Gas and into technology and infrastructure.
Ironically, that move has been motivated by the fracking boom in the United States that had depressed the price of fossil fuels and had made the United States, for the first time in many decades, a net oil and gas exporting country. The OPEC states, which once wielded their oil weapon against the United States and other Western nations, are finding themselves facing a future in which their petroleum resources are not quite as potent as they used to be. They have decided to invest in other industries before the oil and gas money begins to run out.
American companies to benefit from new investment
The Saudi government has signed agreements with 16 companies valued at $50 billion, including a $15 billion deal with General Electric, according to Bloomberg.
Now, instead of billions of dollars flowing from the energy hungry west to the Gulf States, the money is moving in the other direction. The development is proof that economic arrangements are never permanent. Changes in technology and the vagaries of geopolitics can change what once seemed to be eternal in the blink of an eye.
The arms deal will also enrich the United States
The massive arms deal was the result of another opportunity Trump has managed to exploit. The Saudis and other Sunni Arab states find themselves menaced both by ISIS and the Islamic Republic of Iran. Ironically that peril resulted from unwise policies perpetrated from the ill-advised policies of Trump’s predecessor.
Now countries in the Middle East want arms, lots of them and of the most advanced quantities. The United States and companies such as Lockheed Martin are only too happy to provide them. The result is a win-win deal. The Sunni Arab states get some measure of security. The United States gets well-armed allies to oppose mutual enemies with. American defense contractors get lots of business, much to the benefit of their shareholders and employees.
