| | Îò | Mike |  |
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| Äàòà | 15.05.2004 23:53:16 |  |
| Ðóáðèêè | Ñîâðåìåííîñòü; |  |
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Defensenews.com:
Turkey Cancels Multibillion Dollar Contracts
By BURAK EGE BEKDIL, ANKARA, and UMIT ENGINSOY, WASHINGTON
Turkey’s announcement that it has shelved a $4 billion tank co-production plan and halted another $3 billion worth of helicopter and unmanned aerial vehicle projects is a major blow to foreign defense manufacturers, especially Bell Helicopter Textron of Fort Worth, Texas.
“The attack helicopter, modern tank production and unmanned aerial vehicle [UAV] projects have been canceled in their current forms,” said a statement released after a meeting of the Defense Procurement Executive Committee, Turkey’s top decision-making body on defense procurement. “It has been decided to meet the needs of the Turkish armed forces with new models based on domestic production and original designs and by making maximum use of national resources.”
One senior official of the Undersecretariat for Defense Industries, or SSM, said, “It has been clear that the ongoing models have failed to work. … Now we will look for a new model for the deals, which are now defunct.”
Members of the procurement committee include Prime Minister Recep Tayyip Erdogan; Army Gen. Hilmi Ozkok, chief of the Turkish General Staff; Defense Minister Vecdi Gonul; and SSM chief Murad Bayar.
Defense sources said the $2 billion attack helicopter and $1 billion UAV projects would be resurrected in some form, while the $4 billion main battle production deal may not be brought back to life because of Turkey’s financial difficulties.
A Matter of Money
The decision to cancel the three programs may have had to do, at least in part, with Turkey’s bid for entrance into the European Union, according to one Washington-area defense analyst.
Turkey is “buying a lot of expensive stuff and they’re not exactly in the best of financial conditions,” said Frank Cevasco, who runs the consulting firm Cevasco International in McLean, Va. “They are trying to get into the EU. It’s one of the holy grails for them. And they have been asked to do a lot of things politically and economically to conform to the criteria.”
But another U.S. analyst said the move may be part of a larger defense budget reprioritization rather than an attempt to become more fiscally attractive to the European Union.
“Fiscal austerity is important for EU admission, but I don’t know whether this is part of a greater austerity package,” said Richard Aboulafia, a vice president with Teal Group, Fairfax, Va. “Defense spending in and of itself doesn’t mess up the economy. It’s across-the-board deficit spending.”
Regardless of the reasons behind the move, it ensures funding for other Turkish programs, including the airborne warning and control system aircraft, Aboulafia said.
“This gives existing programs a better chance of funding,” he said. “Eliminating people gives the survivors a better chance at life.”
Big Loss for Bell
Bell was selected by the SSM in 2000 for the co-production with local firms of 50 AH-1Z King Cobra attack helicopters.
Contract talks failed in mid-2002 because of differences on price and technology transfer matters, and the SSM then held on-and-off negotiations with Bell as well as opening the door once again for talks with Russian-Israeli team of Moscow-based Kamov, and Lod-based Israel Aircraft Industries for an alternative option. Turkey launched the helicopter program in 1995.
“After the current deal on attack helicopters is canceled, Turkey is likely to open new talks with European and other American companies, as well,” said George Coats, a London-based Turkey defense specialist. “So nine years of efforts have been killed, and Turkey is now looking for something new.”
Bell could stand to lose the most out of Turkey’s program cancellation decisions. The contract, according to Aboulafia, was expected to be Bell’s “long-awaited breakthrough” to export the Z-model aircraft after failing to do so in Romania and Australia.
But, the decision came with little surprise.
“Watching this program over the last three of four years is like watching a bullfight when a bull has 10 spears in him,” Aboulafia said. “In terms of the inability to firmly sign the contract and the Turk’s constantly changing requirements, offset demands, contractual funds and, of course, not being able to fund it.”
Bell spokesman Bob Leder said, “Bell Helicopter is disappointed that the government of Turkey has apparently canceled a number of defense programs, including the attack helicopter program.
“Bell’s King Cobra variant of the AH-1Z was selected by Turkey four years ago after stiff competition from all of the manufacturers of dedicated attack helicopters. Bell is convinced the AH-1Z remains the best solution for Turkey.”
Turkey had been in talks with General Dynamics Lands Systems, Sterling Heights, Mich.; Krauss-Maffei Wegmann, Munich; GIAT Industries, Versailles, France; and Ukraine’s Ukrspetseksport, Kiev, for joint production of 250 main battle tanks. The tank program had not advanced beyond preliminary talks.
“I think the main battle tank program will not be rehabilitated. It seems dead because Turkey has no funds for it,” said Coats.
General Atomics, San Diego, and Israel’s Elbit Systems, Haifa, had been competing for the $1 billion UAV deal.
Megan Scully and Jason Sherman contributed to this
report from Washington.
Ñ óâàæåíèåì, Mike.