Samer Choucair: $24.3 Billion Deal Redraws the Map of Saudi-US Defense Partnership
Investment strategist Samer Choucair said the US State Department’s approval of a potential $24.3 billion military sale to Saudi Arabia, involving 48 F-35 fighter jets and 49 engines, marks a significant development in the defense relationship between Riyadh and Washington. However, he stressed that the approval does not constitute completion of the deal or the commencement of related cash flows, as the proposed transaction remains subject to US legislative and contractual procedures.
Choucair explained that the value of the proposed deal extends beyond the aircraft and engines themselves. The package also includes support equipment, services, training, and other infrastructure required to operate the system, making it a multi-year commitment that investors should assess within the broader trajectory of Saudi defense spending and the capital expenditure associated with Vision 2030.
He added that the economic and investment implications of the deal should be examined across three distinct dimensions: the strategic value of strengthening Saudi Arabia’s defense capabilities, the fiscal impact on the government budget throughout the implementation period, and the industrial opportunities that could emerge within the Kingdom. Determining the scale of domestic economic returns, he argued, requires waiting for the final contracts, local-content requirements, maintenance and training arrangements, and technology-transfer provisions, rather than assuming that the full $24.3 billion headline value will translate directly into economic activity inside Saudi Arabia.
Choucair noted that US companies connected to the program—most notably Lockheed Martin, the aircraft manufacturer, and Pratt & Whitney, the engine manufacturer and a subsidiary of RTX—could benefit from demand associated with the deal if the approval ultimately progresses into a finalized contract. However, assessing the potential impact on their shares requires placing the transaction within the context of each company’s overall business scale and aggregate order backlog.
He emphasized that the deal’s near-term impact on the Saudi economy is likely to be indirect, while oil prices, financing costs, and the pace of economic-diversification projects remain broader and more consequential factors in determining the trajectory of Saudi public finances and asset markets.
According to Choucair, opportunities arising from the deal could extend into maintenance, repair and overhaul services, training, simulation, cybersecurity, and logistics. However, the scale of these opportunities will not become precisely measurable until the implementation details are clarified.
Samer Choucair concluded that the US announcement should be viewed as an important strategic signal rather than a realized investment inflow. From an institutional investment perspective, he said, the transaction should be assessed through the lens of its approval stages, delivery schedule, operating and support costs, localization requirements, and the extent to which defense commitments could affect the Kingdom’s capacity to sustain financing for its economic-diversification programs.