The Royal Guard's three infantry battalions are stationed near Riyadh and have thus far had to make due with light weapons and armored vehicles. The addition of Boxers, however, would provide the Guard with international state-of-the-art equipment.
But Boxers are also well suited for suppressing uprisings, particularly because their tires make them useable on roads. Proponents of exporting to Saudi Arabia in the Federal Security Council argue that the tanks are not intended for Saudi Arabia's National Guard, which is responsible for ordinary combat missions. As such, they say, the tanks would only be deployed for reasons of defense.
Yet if the Arab Spring ever came to Saudi Arabia, the Royal Guards would almost certainly be involved, particularly when it came to defending the royal family in an emergency situation. One scenario could involve units loyal to the royal family fighting revolting crowds with German tanks. That was the argument used by German diplomats and the Ministry of Economic Cooperation and Development before the meeting, and it's also the view held by Justice Minister Sabine Leutheusser-Schnarrenberger.
In the Federal Security Council, the liberal justice minister is one of the most vocal critics of arms exports to the Saudis. Last year, she initially opposed Merkel when the Council discussed the Saudis' request for Leopard tanks, but then she deferred to the cabinet's decision. Leutheusser-Schnarrenberger did not attend last week's meeting. Instead, like Finance Minister Wolfgang Schäuble, she sent a deputy, officially because of a scheduling conflict. But ministers can vote only in person.
The Boxer deal would be a lucrative one for the German arms industry, but the companies involved will have to wait. Merkel and her ministers declined to reach a decision during last week's Federal Security Council meeting and have postponed it until next year.
Countries in Troubled Regions
In addition to Saudi Arabia, the United Arab Emirates is the other major importer of German weapons. In the last three years, the German government has approved the sale of about 1.2 billion in German armaments to the UAE.
But Saudi Arabia, the UAE and Qatar aren't the only ones to benefit from the change in German export policy, and indications are that the arms export business remained strong this year as well. Although the government has yet to publish concrete figures, the Hermes export credit guarantees that were approved this year to back arms export deals are one indicator of how strong the business remains.
Six guarantees were approved by the end of November for a total value of close to 3.3 billion. That's already 800 million more than in 2011, says Left Party arms expert Jan van Aken, and the year isn't over yet. And the six guarantees have been issued for deals with countries in troubled regions throughout the world. The biggest recipient is Algeria, followed by Egypt, Israel, Indonesia, Iraq and Pakistan.
The guarantees for Egypt (700 million) and Israel (405 million) are especially sensitive. For both countries, the guarantees are intended to secure the purchase of submarines made by HDW in the northern port city of Kiel.
The submarines for Egypt, which are not as technically sophisticated as the ones for Israel, led to a dispute between Merkel and Israeli Prime Minister Benjamin Netanyahu, who would like to block the Egypt purchase. The issue has yet to be resolved, but it is possible that Islamist Egyptian President Mohammed Morsi may soon take delivery of two new submarines.
The Egyptian case illustrates that the Merkel doctrine is in fact a large-scale program to help the domestic arms industry. Western countries, including crisis-stricken countries in the European Union as well as the debt-ridden United States, are radically reducing military spending. Germany's Bundeswehr also has to cut costs. Germany's military, for example, will be buying fewer "Puma" armored personnel carriers. The situation is even worse with the "Tiger" helicopter, with the military canceling half of its original order of 80 units.
Two options remain for the German arms industry, with its 80,000 jobs: Either it shrinks with declining demand, or it develops new markets. But those markets happen to be regions of the world where dictators are at war with one another, religious regimes are funding terrorists or autocrats use violence to suppress their own people. The biggest growth markets are in the Middle East and in the emerging economies of Southeast Asia and South America.
Compared to France and the United Kingdom, Germany is still restrained when it comes to promoting the domestic arms industry. Former French President Nicolas Sarkozy remains the champion of promoters of his own war industry. He is thought to have promised rising nuclear power India a nuclear technology deal as a bonus if it chose to buy French fighter jets. It was an offer the Indians couldn't pass up.
But the Merkel administration is also making inroads in the field of arms sales. "In Germany, we are seeing increasingly intensive political support for offsetting declines in military spending with more arms exports," says Mark Bromley, an analyst with the Stockholm International Peace Research Institute (SIPRI).
The Hermes guarantees are an important tool in the process. They provide financial security to companies engaged in major deals, such as the construction of submarines and frigates. Furthermore, Merkel is now using her trips abroad to pave the way for weapons deals. In Angola, for example, she offered President José Eduardo dos Santos the prospect of an energy partnership. But she also reminded him of the many offshore oil platforms that are largely unprotected. "We would also like to help you with your defense efforts, such as upgrading your navy," Merkel said at an economic conference in the Angolan capital Luanda. Specifically, she was talking about patrol boats for the Angolan coast guard, at 10 million to 25 million apiece.
The government also uses the Bundeswehr for its export offensive. For instance, there has been a "Eurofighter Task Force" in place at the Defense Ministry since 2008. The German Air Force spends more than 20 million in taxpayer money to support the marketing of Eurofighters to India.