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NATO Treads Carefully on French Deal With Russia

Apr. 15, 2014 - 04:32PM   |  
By PIERRE TRAN   |   Comments
The Vladivostok, a Mistral-class helicopter carrier ordered by Russia, leaves for its first sea trial on March 5. Russia ordered two carriers with an option for two more. (Frank Perry/AFP/Getty Images)
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PARIS — France has the right to decide whether to deliver a controversial helicopter carrier to Russia, NATO chief Anders Fogh Rasmussen said. But the opinions of allies also count.

The deal with Moscow may become tougher as the crisis with Ukraine deepens. Foreign policy chiefs from the European Union, US, Russia and Ukraine are due to meet this week in a bid to ease tensions.

Apart from the naval deal on the Mistral helicopter carrier, French hopes for the land sector have been put on hold. Swedish truck maker Volvo has told its French unit, Renault Trucks Defense (RTD), to effectively freeze talks on co-development of a Russian armored vehicle.

Political pressure may be high, but Russian industry hopes to sell arms by attending the June Eurosatory exhibition for land weapons here.

Asked whether Paris should hand over the Mistral helicopter carrier to Moscow, Rasmussen said April 8, “It is a national decision. I am not going to interfere with such national decisions.

“I am confident that France will take the necessary decision, taking into account all the concerns that have been expressed,” he said.

That balanced approach should be applied to Russian interest in French armored vehicles and other military equipment, Rasmussen added.

“Let me stress that such possible regulations are not NATO business, they are dealt with in the European Union and other fora,” Rasmussen said.

The NATO secretary general was speaking at a news conference at a high-level seminar on NATO transformation.

Since Russia last month effectively annexed Crimea from Ukraine, France has come under pressure to cancel a government-to-government arms deal signed in July 2011 with Russia. That €1.2 billion (US $1.6 billion) contract covered the delivery of two Mistral-class helicopter carriers, with options for two more.

Some 80 percent of the first two ships has been completed; Russian partner OSK holds a 20 percent work share, an industry executive said.

French subcontractor STX has built the vessels at the Saint-Nazaire shipyard in northwestern France, based on a design by prime contractor DCNS.

A second batch of two ships would be built on a 60-40 basis, with the Russian company taking the larger share. DCNS has transferred technology for the work to move to Russia.

Moscow has met an undisclosed payment schedule, the executive said.

Some 400 Russian sailors are due to land in June for four months of training off the French coast, to be led by training company DCI.

A French Navy officer said there is a big difference in the Russian crew culture, which is strictly based on orders from above and a large number of sailors. The Mistral is highly automated, and the 22,000-ton ship requires a relatively small crew of 177. A Russian equivalent would require around 1,000 sailors.

Russia’s search for a carrier drew a number of offers at the time, including from shipbuilders in the Netherlands, Spain and South Korea, two sources said. The French offer of technology transfer made the difference.

France might already have decided whether to deliver the first ship, named Vladivostok, in October, but Paris can keep options open by announcing it only at the delivery time, a French and US source said.

That approach offers “leverage,” but it does not look good, the US official said. “It’s very visible,” the official said.

The sources said Paris has won time to work toward a solution between Moscow and Kiev, rather than revealing its intention.

The Saint-Nazaire dockyard is in the Brittany region, where Defense Minister Jean-Yves Le Drian has his electoral base. President François Hollande offered Le Drian the prime minister’s post at a recent Cabinet reshuffle, but the latter declined, media reports said.

Exporting the Mistral does not send sensitive technology to Russia, the US official said.

The Mistral is essentially a civilian ship, and the technology “is not very advanced,” the official said. On bilateral relations between Paris and Washington, “France is in lockstep,” the official said.

A cancellation would hurt France’s image in export markets, a defense specialist said. That concern puts pressure on Paris to deliver the Mistral ships, since a contract has been signed.

Tensions on Land

Under strict arms export rules, companies need government authorization to give presentations, to show the equipment and to sign contracts. Given the deep political concerns, the French administration is unlikely to encourage companies to pursue new deals with Moscow, the specialist said.

That tension also has hit a potential deal for Renault Trucks Defense, which signed up with Russian manufacturer UralVagonZavod to develop an infantry fighting vehicle named Atom for the Russian Army.

“Discussions with the Russians are on hold,” an RTD spokeswoman said. “We’re waiting for instructions from the French and Swedish governments.”

RTD is part of Sweden’s Volvo group. The French company has sent two petit véhicule protégé small armored cars and two véhicule blindé leger scout cars for trials in Sochi, Russia.

There is no French ban on arms sales to Russia, a Defense Ministry spokesman said. All of the European allies would need to agree to such a measure.

Trade Show Plans

Meanwhile, Russian industry, including 17 companies, has booked 620 square meters of exhibition space at Eurosatory, said a spokeswoman for Coges, the show organizer.

Separately, Japanese industry has for the first time booked space at the show, with 126 square meters shared by 11 companies.

The US will send few officials, partly because of budget cuts but also due to concerns over explaining the need for such a duty.

The trade show, backed by the French Defense Ministry, runs June 16-20 here.

Officials with the Euronaval exhibition, which runs here Oct. 27-31, were not available for comment. The Russian Navy chief of staff attended the previous show in 2012.

The organizers of July’s Farnborough International Airshow in Britain said they are carefully watching events unfold in Ukraine

“The Russian civil aerospace, defense and space communities are regular exhibitors at the airshow. We are keenly aware of the situation in Ukraine, and we are carefully monitoring the response of the international community. We would comply with any official measures that are put in place,” said Paul Everitt, chief executive of ADS, Britain’s aerospace and defense trade lobby group and the chairman of Farnborough International, the show’s organizer.

Russian companies are planning a strong turnout at what will be the world’s largest gathering of aerospace and defense companies at Farnborough. Irkut and United Aircraft are among the Russian companies with defense interests planning to attend the July show.

Rosoboronexport, the Russian government’s defense export/import organization, also will be present.

Farnborough International said there are 16 Russian companies and one Ukrainian company, Antonov, signed up to exhibit. ■

Andrew Chuter in London contributed to this report.

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