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Justin Trudeau Signals Canada Could Freeze Saudi Arms Export Contract

(Bloomberg) — Justin Trudeau said he’s willing to freeze export permits with Saudi Arabia that allow armored car sales in the kingdom, as opposition lawmakers raised questions about human rights abuses.

The New Democratic Party asked the prime minister Monday why Canada would arm “one of the world’s worst human rights offenders,” with the Middle Eastern nation under intense scrutiny over the death of U.S.-based journalist Jamal Khashoggi. Canada exports armored vehicles, manufactured by General Dynamics Land Systems Canada, to the Kingdom.

“Our government is committed to a stronger and more rigorous arms export system,” Trudeau told the House of Commons in Ottawa. “We have frozen export permits before when we had concerns about their potential misuse, and we won’t hesitate to do so again.”

Canada exported C$1.37 billion ($1.05 billion) worth of goods to Saudi Arabia last year, mostly tanks and other armored fighting vehicles and their parts, according to Statistics Canada. London, Ontario-based General Dynamics Land Systems, a unit of U.S.-based General Dynamics Corp., manufactures armored vehicles under a contract with Saudi Arabia signed by the Canadian government in 2014. The contract is worth up to $13 billion. Representatives at the Canadian unit didn’t immediately respond to a request for comment on Monday.

The prime minister said the government is discussing “next steps” with Canada’s allies, adding “we condemn the murder of journalist Jamal Khashoggi.” Freezing export permits would widen a Saudi rift with Canada that began earlier this year after the Trudeau government publicly criticized the arrest of women’s rights activists.

Chancellor Angela Merkel signaled Sunday that Germany will suspend exports of military equipment to Saudi Arabia, and U.K. Foreign Secretary Jeremy Hunt promised to take “serious” measures against the kingdom once an investigation is complete. U.S. President Donald Trump said Monday he spoke with Crown Prince Mohammed Bin Salman and isn’t satisfied with the Saudi government’s explanation.

“We strongly demand and expect that Canadian exports are used in a way that fully respects human rights,” Trudeau said in the legislature without identifying any company or export contract by name. He spoke hours after convening an emergency meeting of cabinet ministers and senior officials on the issue.

Foreign Minister Chrystia Freeland told reporters earlier Monday that Saudi Arabia must bring those responsible for the journalist’s killing to justice and that its explanations so far aren’t credible. “There are very important questions about the entire relationship with Saudi Arabia that need to be asked,” she said, while declining to comment on arms contracts.

A diplomatic feud between Canada and the kingdom erupted in August after Freeland and the Canadian government sent a series of tweets about the arrest of human rights activist Samar Badawi. Saudi Arabia fired back, freezing certain commercial ties, expelling Canada’s ambassador and recalling students from Canada. The spat had stabilized somewhat before Khashoggi’s death, but the countries remain at odds. The Saudis have publicly demanded an apology from Canada for the tweets.

(Corrects amount of USD conversion in fourth paragraph.)

–With assistance from Josh Wingrove.

To contact the reporter on this story: Greg Quinn in Ottawa at gquinn1@bloomberg.net

To contact the editors responsible for this story: Theophilos Argitis at targitis@bloomberg.net, Stephen Wicary, Chris Fournier

For more articles like this, please visit us at bloomberg.com

©2018 Bloomberg L.P.

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