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Turkey Won't Rush Air Defense Contract

January 15, 2015 (Photo Credit: JOHN MACDOUGALL, AFP/Getty Images)

ANKARA — Turkish government leaders are refraining from making a hasty "final-final" decision on a multibillion dollar contract that will build the country's first long-range air and anti-missile defense architecture.

"There are political, technical and financial parameters at play, and we don't want to make a wrong move," one senior procurement official said.

After a crucial meeting of Turkey's top procurement panel, the Defense Industry Executive Committee, Prime Minister Ahmet Davutoglu said Turkey would continue to negotiate with all three bidders in the disputed program.

In September 2013, Turkey selected China Precision Machinery Import-Export Corp. (CPMIEC) for a $3.44 billion offer. But after increased pressure from NATO allies, Ankara opened parallel talks with the second- and third-comers in the bidding — the European Eurosam, maker of the Aster 30, and the US Raytheon/Lockheed Martin, offering the Patriot system, respectively. Davutoglu said talks with all three bidders would cover an extended period of six months.

"One imminent political deliberation is whether the US Congress will recognize the alleged Armenian genocide in April. We will wait Congress' move before making a decision on the contract," said a top government official for defense and security issues.

The US Congress may, for the first time, recognize as genocide the killings of 1.5 million Armenians during Ottoman Turkey in 1915-1920. April will be the centenary of the start of incidents that Armenians and several parliaments across the world have said was genocide, but the US has so far avoided to label them as such.

"Apparently, the Turks want to use the air defense contract as one of their many cards in the game [to pressure Washington not to recognize the genocide]. It may or may not work. But the success of the US contender depends first of all on this," said one London-based Turkey specialist.

The procurement official did not comment directly on whether Congress' decision would be a parameter in selecting a winner in the contract, or whether the US contender would be blacklisted for political reasons. But he said: "Our procurement decisions are not free of deliberations on foreign policy."

Both the procurement and defense officials said that although all three bidders are in the picture, they admitted that talks with CPMIEC have not been productive.

"I cannot say negotiations with the Chinese contender have evolved as we expected," the procurement official said.

The defense official said: "[CPMIEC is] still in the game. But they don't stand where they stood when we selected them. We expect all bidders to improve their offers in line with four criteria: better technological know-how, local participation, quick delivery and price."

Turkish procurement officials earlier admitted that technical negotiations with CPMIEC had dragged into several problematic areas and "this option now looks much less attractive than it did [in 2013]."

In September, for a fifth time, Turkey extended the deadline for all three bidders to Dec. 31. The Jan. 7 decision to extend the deadline for another six months is the sixth extension.

The Turkish program consists of radar, launcher and interceptor missiles. It has been designed to counter enemy aircraft and missiles. Turkey has no long-range air defense systems.

About half of Turkey's network-based air defense picture has been paid for by NATO. The country is part of NATO's Air Defense Ground Environment. Without NATO's consent, it will be impossible for Turkey to make the planned Chinese system operable with these assets, some analysts say.

NATO and US officials have said any Chinese-built system could not be integrated with Turkey's joint air defense assets with NATO and the United States. They also have warned that any Turkish company that acts as local sub-contractor in the program would face serious US sanctions because CPMIEC has been sanctioned under the Iran, North Korea and Syria Nonproliferation Act.


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