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France Cleared To Sell Falcon Eye Satellite to UAE

Feb. 25, 2014 - 04:43PM   |  
By PIERRE TRAN   |   Comments
Obstacle Removed: The UAE buy of the French Falcon Eye, based on the Pleiades satellite, is expected to move forward.
Obstacle Removed: The UAE buy of the French Falcon Eye, based on the Pleiades satellite, is expected to move forward. (Airbus Defence and Space)
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PARIS — The White House has swept aside attempts by Lockheed Martin to overturn a French sale of military spy satellites to the United Arab Emirates, a senior French defense official said.

President François Hollande met President Barack Obama Feb. 10 on a three-day state visit, and the two leaders agreed that France would go ahead with the Falcon Eye satellite sale to the UAE, worth almost US $930 million, the source said.

“Lockheed Martin has put pressure” on the administration to cancel the deal, the senior French defense official said, adding, “there has been a political solution ... at the highest level.”

The UAE had chosen Lockheed’s Digital Globe satellite, but later opted for the Falcon Eye. However, the French needed US approval to sell the satellite because it contains US-made components.

Deepening political ties between Paris and Washington are believed to be the reason the US is allowing the French deal to go forward.

French media have widely reported US industry lobbied the government to slow down the contract for the satellite program, as the European manufacturers needed clearances for American components under the US international traffic in arms regulation.

A holdup under the rules threatened a completion of the contract due at the end of January, putting the deal under pressure, the reports said.

Now that there is political support, there is no contract renegotiation and no plan to change components, the official said.

“We are not going to renegotiate. It’s not a technical problem,” the official said.

No comment was available from the Elysée president’s office. The White House also declined to comment, and directed questions to the State Department. A State Department spokesman declined to comment.

Under the contract, signed July 22, the satellites will be built by prime contractor Airbus Defence & Space and payload-maker Thales Alenia Space.

After the UAE chose Lockheed’s satellite, intensive efforts by Defense Minister Jean-Yves Le Drian with Sheikh Mohammed Bin Zayed won over the support of the deputy supreme commander, business website La Tribune reported.

Le Drian also urged Thales Alenia Space and the rival Airbus unit to field a joint offer, rather than pitch separate and competing products, the report said.

The two companies teamed up and pitched two satellites and a ground station based on the Pleiades system developed for the French military.

Thales CEO Jean-Bernard Levy declined to comment on the satellite deal due to client confidentiality rules in the contract signed in July. No comment was available from the Airbus space division.

According to Space News, Francois Auque, head of Airbus Defence & Space’s Space Systems division, discussed the issue during a Feb. 13 event here. He credited Le Drian with swaying the UAE.

The newspaper reported that Auque and Jean-Loic Galle, chief executive of Thales Alenia Space, disagreed on how the final export approval was obtained.

“There was a lot of bureaucracy and lots of paper, but at the end of the day, it was pretty much business as usual and followed the normal process,” Auque said, according to the paper.

A Lockheed spokeswoman also declined to comment, saying, “This is a matter involving the Falcon Eye program contractors.”

It comes as no surprise a US company lobbied the US government to get help in winning an export contract, a stock market analyst said.

“This type of reaction — to block a contract — is not unusual,” the analyst said.

A defense sector consultant agreed, and said it reflects a growing US-European competition in critical export markets.

The agreement between the Obama and Hollande teams at the summit signals a political closeness between the two administrations, the consultant said.

That perceived political closeness between the White House and the Elysée palace follows France taking a lead military role in Libya, Mali and the Central African Republic.

Hollande, alone in Europe, also offered to step up last year when it looked like the US would move against Syria, before Washington backed off on taking action.

Those French moves in sub-Saharan Africa, supported in logistics on the ground by American forces, come as the US geopolitical focus moves to the Asia-Pacific region.

“The cooperation between the French and US militaries is probably strongest today than at any point in recent memory. Similarly, the two countries’ top diplomats [Secretary of State John Kerry and French Foreign Minister Laurent Fabius] enjoy warm relations,” the consultant said.

“Hollande’s visit to the US, the first by a French president in nearly two decades, proved that a close working relationship is also possible at the highest political levels.”

Such an agreement sets a positive backdrop to Obama’s first official trip to the European Union this summer, the consultant said.

Obama visited here when he was the junior senator from Illinois on the campaign trail in the 2008 US presidential election, and he was received by then-President Nicolas Sarkozy. On that visit, the presidential candidate told the press the Afghanistan campaign should be the US military’s focus, rather than Iraq. ■

The story “France Cleared To Sell Falcon Eye Satellite to UAE,” which appeared in the Feb. 24 issues, identified DigitalGlobe as a Lockheed Martin satellite; DigitalGlobe is an independent commercial entity. DigitalGlobe also denies that it agreed to sell its GeoEye-2 satellite to the United Arab Emirates, although the company acknowledges receiving “unsolicited” interest from the Emirates.

Aaron Mehta and John T. Bennett contributed to this report.

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