LONDON: Qatar could saddle British taxpayers with a bill for billions of pounds by defaulting on payments for military equipment ordered from the UK.
According to one expert, while it was not unusual for buyers to miss payments for various reasons, it was hardly likely to be necessary for Qatar, one of the wealthiest countries in the world.
Jeremy Binnie, Middle East specialist on the publication Jane’s Defense Weekly, questioned whether Qatar needed the 24 Typhoon supersonic fighter jets it has ordered from British Aerospace as part of a £6 billion ($7.7 billion) package, including weapons, pilot training and maintenance.
“The Qataris are also buying from the French and the Americans. Do they need three types of fighter jets? The Ministry of Defense dismisses the suggestion that they don’t,” he said.
Andrew Smith, of the Campaign Against Arms Trade, said the concept of the government underwriting a contract such as the Typhoon deal with Qatar was not unusual.
“But the fact that Qatar has already defaulted has obviously set off alarm bells in the Treasury and calls the entire deal into question,” he said.
“This is an example of the cozy and compromising relationship between arms companies and government. It is risking billions of pounds in order to support military sales to a repressive and authoritarian regime at a time of severe regional tensions.
“The risk is made even greater by the Qatari government’s disregard and the complete lack of transparency in its military spending, on which zero information is publicly available.
“The sale of these fighter jets is totally irresponsible and so is this deal,” he said.
A deal to sell the jets — the biggest export contract in a decade for Typhoon fighters — to Qatar was struck last December during a visit by the UK Defense Secretary, Gavin Williamson, to Doha.
By underwriting the deal through UK Export Finance (UKEF), the government’s credit agency, the UK Treasury guaranteed that Britain’s defense industry and its employees would not lose out financially if the buyer failed to honor the contract.
However, under the arrangement, if Qatar fails to pay up, responsibility for settling the bill with British Aerospace will fall on the Treasury — which means British taxpayers.
Doha does not appear to have shown any concern either for taxpayers or for the thousands of jobs potentially at risk at the British Aerospace plant in northwest England, where the Typhoons will be built.
Leaked documents from the Treasury show that the Qataris wanted Britain to finance most of the cost of the deal and also use British guarantees to reduce interest payments.
The documents describe the arrangement as “unprecedented” and indicate there is concern over whether Qatar can meet its obligations.
“The transaction amounts to an unprecedented level of support from UKEF to one buyer, skewing the UKEF portfolio by concentrating about 25 percent of their portfolio risk in one transaction,” the Treasury memo said.
Qatar has already missed the July deadline for the first instalment. Embarrassingly, this was revealed just after the emir of Qatar’s visit to London.
The situation is not especially unusual, said Binnie, since such deals are sometimes announced before all the financing is in place.
That appears to be the case with Qatar, which was still trying to arrange $4 billion of financing in July. According to British Aerospace, the new deadline for the first payment is now the end of September.
Storm clouds gather over Qatar’s $7 billion Typhoon deal
Storm clouds gather over Qatar’s $7 billion Typhoon deal
- The concept of the government underwriting a contract such as the Typhoon deal with Qatar was not unusual
- ‘This is an example of the cozy and compromising relationship between arms companies and government’
Saudi Arabia set to lead $500bn wave of GCC debt maturities: Kamco Invest
RIYADH: The Gulf Cooperation Council region is expected to see elevated levels of fixed-income maturities over the next five years, driven primarily by Saudi Arabia and the UAE, a new analysis showed.
In its latest report, Kamco Invest said fixed-income maturities in Saudi Arabia are projected to total $174.5 billion between 2026 and 2030, closely followed by the UAE at $171.8 billion.
Saudi Arabia’s debt market has recorded robust growth in recent years, attracting strong investor interest in fixed-income instruments amid a global environment of elevated interest rates.
In October, Kuwait Financial Center — also known as Markaz — said Saudi Arabia dominated the GCC’s primary debt market in the third quarter, raising $20.32 billion through 36 issuances, a 62.7 percent year-on-year increase in value.
“The bulk of the maturities in Saudi Arabia are for bonds and sukuk issued by the government at $106.4 billion, while in the case of the UAE, the lion’s share of maturities are for instruments issued by corporates at $136.2 billion,” said Kamco Invest.
Over the next five years, fixed-income maturities in Qatar are expected to reach $85.6 billion, while Kuwait, Bahrain and Oman are each projected to record maturities of around $25 billion.
Citing Bloomberg data, the report showed that GCC sovereign maturities stand at $244.8 billion over the 2026–2030 period, while corporate maturities are higher at $263.3 billion.
“Both bond and sukuk maturities are expected to remain elevated starting from 2026 until 2030 and then gradually taper for the rest of the tenor. The higher maturities during the next five years reflects deficit financing issuances from GCC governments as well as investment and refinancing related issuances from the corporates,” said Kamco Invest.
The report added that the majority of maturities are denominated in US dollars, accounting for 64.7 percent, followed by local-currency issuances in Saudi riyals and Qatari riyals at 10.6 percent and 6.3 percent, respectively.
Owing to the strong credit profiles of GCC governments, most maturities fall within the high investment-grade category. A-rated instruments account for $208.7 billion, while total investment-grade maturities stand at $239.1 billion.
In terms of instruments, conventional bonds dominate, with maturities of $317.6 billion over the next five years, compared with $190.5 billion for sukuk. Corporate bond maturities, at $173.4 billion, exceed government bond maturities of $144.2 billion.
By sector, banks and other financial services firms account for $210.4 billion in maturities through 2030, representing 79.9 percent of total corporate maturities and 41.4 percent of overall GCC maturities. The energy sector follows with $21.8 billion, or 8.3 percent, of corporate maturities, while utilities and industrials account for $13.6 billion and $5.4 billion, respectively.
Real estate maturities are concentrated mainly in the UAE and Saudi Arabia, at $11.2 billion and $4.3 billion, respectively, through 2030.
Issuances in 2025
Aggregate bond and sukuk issuances in the GCC reached $206.6 billion through the third week of December 2025, broadly unchanged from $206.8 billion in the same period a year earlier.
However, issuance patterns shifted markedly. Government issuances declined sharply to $77.9 billion in 2025, from $98.6 billion in 2024, while corporate issuances rose to a record $128.6 billion, up from $108.2 billion.
In terms of type of issuances, sukuk issuances witnessed a sharp decline during 2025, whereas bond issuances showed a healthy growth.
“Aggregate GCC bond issuances stood at $125.2 billion in 2025, the highest on record, compared to $106.2 billion during 2024, whereas sukuk issuances declined by 19.1 percent to reach $81.4 billion this year as compared to issuances of $100.6 Bn during 2024,” said Kamco Invest.
Despite an 18.3 percent decline, Saudi Arabia remained the region’s largest fixed-income issuer, with total issuance of $82.0 billion in 2025, down from $100.3 billion the previous year.
Issuances from Qatar fell 21.7 percent to $22.1 billion, while the UAE recorded modest growth, with total issuance rising to $64.9 billion from $63.4 billion. Kuwait posted the sharpest increase, with issuance surging to $20.5 billion from $2.6 billion in 2024 following the approval of its debt law.
Green issuances
Green-instrument issuance in the GCC rose sharply in 2025, though it remained below the record levels seen in 2023. Total green issuance reached $12.5 billion, up from $4.6 billion in 2024 but below $17.3 billion recorded in 2023.
The UAE led the region with $5.6 billion in green issuance, compared with $3.8 billion a year earlier. Saudi Arabia followed with $5.1 billion, after recording no green issuances in 2024.
Green sukuk are Shariah-compliant instruments designed to finance environmentally sustainable projects, including renewable energy, clean transportation and climate-resilient infrastructure.
Outlook
Kamco Invest expects higher issuance levels in 2026, particularly among GCC countries facing fiscal deficits. The UAE and Qatar are also projected to see elevated corporate issuance.
A potential decline in interest rates could further support issuance activity, especially early in the year, as borrowers seek to lock in lower funding costs.
“Maturity refinancing is expected to result in approximately $85.4 billion in issuances during the year, while government deficit financing led by lower average oil prices would also contribute to the overall trend during the rest of the year,” the report said.
Based on IMF forecasts, deficit financing could result in issuance of close to $60 billion in 2026, it added.
