§ Mr. CohenTo ask the Secretary of State for Foreign and Commonwealth Affairs if he will list what is involved in the offset programme in relation to the Tornado deal with Saudi Arabia.
§ Mr. Sainsbury[holding answer 24 April 19891: I have been asked to reply.
The Al Yamamah economic offset programme arises from and is associated with project Al Yamamah, the sale of Tornado and other equipment to the Government of the kingdom of Saudi Arabia. However, the offset programme is aimed at encouraging and assisting the creation of viable and profitable joint and other commercial ventures in any sector between United Kingdom and Saudi Arabian companies. It is a broadly based and flexible programme designed to provide the maximum benefit to the economies of both countries, and is open to all United Kingdom companies, not just defence contractors. Detailed arrangements for the programme were finalised between the Government and the Saudi Government at the end of last year. and the programme was formally launched to United Kingdom industry at a British seminar held in London on 31 January 1989.
The British offset office established within my Department has responsibility in the United Kingdom for implementing and managing this programme and it is working closely both with other Government Departments and with the many companies who have expressed interest in developing project ideas under the initiative. It is hoped that the first venture proposals will be ready for discussion with the Saudi Government offset committee very shortly. Because of the commercial confidentiality of the market opportunities under consideration, and respecting companies' wishes in this matter, we cannot at this stage give details of the business proposals under consideration.