United Arab Emirates Confirms Hiring Blackwater Founder’s Firm

The United Arab Emirates confirmed on Sunday that it had hired a company run by Erik Prince, the billionaire founder of Blackwater Worldwide, to provide “operational, planning and training support” to its military. But it gave no details of the company’s project to build a foreign mercenary battalion for the Emirati government.

A written statement from a top Emirati general, issued through the U.A.E.’s official news agency, said that the country had relied extensively on outside contractors to bolster its military, and that all work with contractors was “compliant with international law and relevant conventions.”

The statement, by Gen. Juma Ali Khalaf al-Hamiri, said that the U.A.E. had signed a contract with Reflex Responses, Mr. Prince’s company, but made no mention of the hundreds of Colombian, South African and other foreign troops now training at an Emirati military base. The statement did not mention Mr. Prince by name.

The New York Times reported on Sunday that the company last year signed a $529 million contract with the Emirati government to recruit and train a foreign battalion for counterterrorism and internal security missions, according to former Reflex Responses employees, American officials and corporate documents.

Former employees said that the company had a separate lucrative contract to help protect a string of nuclear reactors planned in the U.A.E. and to provide cybersecurity for the nuclear sites.

The U.A.E is a close American ally, and officials in Washington indicated that there was some support in the Obama administration for the foreign mercenary battalion. But the State Department is looking into the project to ensure it does not violate American laws regulating the export of defense technology and expertise.

General Hamiri’s statement said his country’s military had gone through an “extensive process of development and Emiratisation,” which has allowed Emirati forces to make “meaningful contributions” in recent conflicts in places like Kosovo, Iraq, Afghanistan and Libya.

Kateri Carmola, a professor at Middlebury College in Vermont who researches the use of private security companies, said that it was common for countries to hire contractors for military training, but that it appeared that Reflex Responses had more ambitious goals both in the U.A.E. and elsewhere.

“There is no real legal precedent for a company like this, where the U.A.E. would be used as a launch pad for a wide range of missions, and potentially for a wide range of clients,” she said.

G.M. to Spend $2 Billion in Hiring and to Upgrade U.S. Plants

The company said its plans to upgrade 17 plants in eight states would create or save more than 4,000 jobs.

G.M.’s chief executive, Daniel F. Akerson, made the announcement at a transmission plant in this northern Ohio city, where the company will spend $204 million and retain 250 jobs.

“We are doing this because we are confident about demand for our vehicles and the economy,” Mr. Akerson said.

G.M. did not specify where and when it would make all the investments, preferring to announce positive news periodically to underscore its recovery from its 2009 bankruptcy.

“There’s always going to be naysayers and there’s always going to be people who buy a G.M. product no matter what,” said Rebecca Lindland, an analyst with the research firm IHS Automotive. “It’s about influencing those people who are in the middle.”

About 1,350 of the jobs cited will be filled by current G.M. employees who are on layoff. Once those workers are recalled, the remaining positions will go to new hires at a lower wage rate.

The company’s contract with the United Auto Workers union allows it to hire new workers at wages of $14 an hour — half what it pays existing hourly employees.

The two-tier wage scale is expected to be a major topic at the bargaining table this summer, when G.M., Ford and Chrysler all negotiate new contracts with the U.A.W. The current four-year agreements expire in mid-September.

The U.A.W. vice president in charge of the G.M. division, Joe Ashton, said he expected all the laid-off workers to be recalled before the contract expired.

Mr. Ashton declined to say what changes the union might seek in the two-tier system during the negotiations.

“They will be discussed at the table,” he said.

The union’s president, Bob King, has said the U.A.W. hopes to get back some of the concessions it made during the last round of negotiations, in 2007, when Detroit’s Big Three were in dire financial condition.

Since then, both G.M. and Chrysler were bailed out by the American taxpayers and drastically restructured in bankruptcy court. Ford recovered on its own without federal assistance and has reported healthy profits over the last two years.

G.M.’s announcement of new jobs and investments came after the company’s announcement last week that it earned $3.2 billion in the first quarter of this year.

The company has been steadily revamping its product lineup since emerging from bankruptcy in the summer of 2009, adding more fuel-efficient small cars and crossover vehicles.

The transformation is starting to produce better sales and greater market share against rivals. G.M. reported domestic market share of 19.6 percent in the first four months of this year, compared to 18.7 percent for the same period a year ago.

“For the first time in a generation, in the last year we took market share,” said Mr. Akerson.

G.M. has 49,000 hourly workers in the United States — less than half the number it had five years ago.

Since emerging from Chapter 11 bankruptcy protection in July 2009, G.M. had committed to investing $3.4 billion in its plants and to creating or preserving an estimated 9,000 jobs.

Tuesday’s announcement of an additional $2 billion in investment is another step in the rebuilding process. In addition to the improvements in Toledo, the company said last week that it would spend $131 million at an assembly plant in Kentucky.

The United States government still owns a 26 percent stake in the automaker as part of the $50 billion taxpayer bailout. The Treasury Department could begin selling some of its remaining shares as soon as May 22, the first day it will be permitted to sell them under terms of G.M.’s initial public stock offering.

G.M. has ample cash reserves of more than $36 billion to upgrade and expand manufacturing facilities such as the Toledo plant.

“They’re spending money so they can make money,” said Ms. Lindland. “And the more profitable they are, the better chance they have of decreasing the ownership of the government.”

Nick Bunkley contributed reporting from Detroit.