Reuters
Published Aug 16, 2019 04:02PM ET
Canada awards multi-billion contract to General Dynamics as election looms
OTTAWA (Reuters) - Canada on Friday announced a multi-billion dollar contract with General Dynamics Corp (NYSE:GD) for equipment that will be manufactured in a region where the ruling Liberals need to do well in an October election.
Defence Minister Harjit Sajjan said Ottawa would buy 360 light armored vehicles from General Dynamics Land Systems Canada in a deal worth up to C$3 billion ($2.26 billion). It is also offering the firm a repayable loan of C$650 million.
The vehicles will be built in London, in the province of Ontario. The Liberals hold most of Ontario's seats in the House of Commons and need to retain them to stand any chance of holding onto power in the Oct. 21 election.
The deal is the latest in a string of high-profile government spending announcements in politically sensitive parts of Canada. The official opposition Conservatives, tied in polls with the Liberals, accuse their rivals of trying to buy votes.
Sajjan spokesman Todd Lane denied any link to the election, saying money for the vehicles had been announced in 2017.
"This is about taking care of our women and men in uniform," he said by telephone.
The contract will help preserve jobs at the General Dynamics plant amid continuing uncertainty over the fate of a separate $13 billion deal to sell light armored vehicles to Saudi Arabia. Critics, citing concerns over Riyadh's human rights record, insist the contract be scrapped.
Ottawa is still studying whether to tear up the deal, which it says would cost millions of dollars in penalties.
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.