Canadian soldier Steve Sabo with the 2nd Battalion, Princess Patricia's Canadian Light Infantry from Shilo, Manitoba, drinks some water on a LAV-3 on Friday Aug. 1, 2008.Joe Bryksa/The Canadian Press
The controversial $15-billion sale of hundreds of armoured personnel carriers to Saudi Arabia is not the first time the Canadian government has brokered such a lucrative and contentious sale to the kingdom.
In 1986, during the Brian Mulroney government, Canadian foreign minister Joe Clark travelled to Riyadh to seal a very similar deal with King Fahd himself.
At that time, it was GM Defense of London, Ont., that was making the vehicles; now, it's General Dynamics Land Systems, which bought the GM plant several years ago. The transaction for the so-called light armoured vehicles (LAVs) in 1986 was worth an estimated $250-million.
In Canada today, the concern regarding the deal is over the possible use of the vehicles, equipped with heavy machine guns or cannons, against Saudi Arabia's own population – protesters, Shiites etc. That's ironic because, in 1986, the idea that the LAVs would be used only domestically is what ensured the sale.
The concern then was over such equipment being sold to one of Israel's "enemies" and possibly being used against it. Even though it had been 13 years since the last major Arab-Israeli war, the Canada-Israel Committee and other bodies lobbied hard against the transaction.
U.S. sales encountered similar resistance when they were for fighter jets and observation aircraft known as AWACS (Airborne Warning and Control System). The Israelis didn't want any planes in the neighbourhood more advanced than their own.
However, the Saudis convinced Mr. Clark that the deal for the LAVs was kosher. In an unusually late-night meeting, King Fahd told the minister that the kingdom wanted the vehicles only for self-defence, so its national guard would be "strong and respected."
The sale went through and today there are hundreds of Canadian-made LAVs running around Saudi Arabia. The vehicles now in production are merely to replace them.
Interestingly, at that time too, there was great consternation over the price of oil. In April, 1986, a barrel of Brent crude was going for about $10. Saudi Oil Minister Sheik Ahmed Yamani tried to convince Mr. Clark that Canada and other producers not in the Organization of Petroleum Exporting Countries needed to cut back on production so that the price of everyone's oil could rise. Mr. Clark wasn't buying it – the glut then was coming from the North Sea oil coming on line and from OPEC renegades Nigeria and Iran.
Canadian officials put the then-historic LAV deal in perspective. They explained that sales to Saudi Arabia were becoming acceptable as the kingdom was going through a rare shift in policy. They considered it to be no longer a threat to Israel – it was more concerned with Iran, then at the height of the revolutionary Islamic government.
Such paradigm shifts occur very rarely in a monarchy such as Saudi Arabia.
Some observers think that the kingdom is undergoing another one now. This time, the shift is away from the lock-step relationship it has had with Washington for more than three decades.
In a cheeky, un-Saudi-like interview with The Economist this week, Deputy Crown Prince Mohammed bin Salman, who, at the age of 30, is also Defence Minister, is in charge of the economy and is the favourite son of the King, indicated that Saudi Arabia was tired of being let down by the United States and its increasingly forgiving attitude toward Iran.
"The United States must realize that they are number one in the world and they have to act like it," said the man who is known as MBS to distinguish him from Crown Prince Mohammed bin Nayef, who is known as MBN, a nephew of King Salman and the country's Interior Minister. (It is this Prince Mohammed, aged 56, who will be taking delivery of the Canadian-made LAVs for the country's National Guard, not the Defence Minister. And it is he who is very popular with the Americans, unlike his cousin, the King's son.)
Washington's response to the challenge from MBS was quick and just as cheeky. Dennis Ross, President Barack Obama's some-time Middle East troubleshooter and a strong supporter of Israel, wrote in The New York Times this week that while "distancing from Saudi Arabia will raise further questions with America's traditional partners in the Middle East … the Saudis too need to see that future U.S. commitments to Saudi security could very likely be affected by how much they seem to want to add to current conflicts rather than contain or resolve them."
These really are different times.