Egypt to Pay $1 Billion for France’s Mistral Warships

By Jean-Baptiste Vey and John Irish

PARIS, Sept 23 (Reuters) – France has agreed to promote two Mistral helicopter carriers to Egypt for 950 million euros ($1.06 billion) after their sale to Russia was canceled in August, French officers mentioned on Wednesday.

Cairo has sought to spice up its army energy within the face of a two-year insurgency based mostly throughout the Suez Canal within the Sinai peninsula and fears the battle in neighboring Libya may spill over. Egypt’s allies are additionally eager to burnish its picture in a area beset by turmoil.

“We unwound the contract we had with Russia, on good terms, respectful of Russia and not suffering any penalty for France,” Hollande advised reporters on his arrival at an EU summit in Brussels.

“Yesterday, I agreed the price and conditions of this sale with (Egyptian) President (Abdel Fattah al-) Sisi and so France will ensure the delivery of these ships without losing anything, while helping protect Egypt.”

A French protection ministry supply mentioned the contract was value about 950 million euros, however in contrast to the cope with Moscow wouldn’t embrace any know-how switch.

As of but there had been no talks on the potential armament for the service, which may maintain as much as 16 helicopters and 1,000 troops.

“The ships should be handed over in early March after the training of about 400 Egyptians and some final tests,” the supply mentioned.

A diplomatic supply mentioned Cairo needed to base one ship within the Mediterranean and one other within the Red Sea, making it obtainable for future operations in Yemen, the place Egypt is a part of a Saudi-led coalition combating Houthi rebels.

The French authorities agreed to reimburse 950 million euros to Moscow final month after the Mistral sale to Russia was canceled on account of the Ukraine disaster.

The cope with Egypt comes as France has nurtured new hyperlinks with Sunni Arab states, which respect its powerful stance on their Shi’ite rival Iran and comparable positions on the area’s conflicts.

France has additionally benefited from what some Gulf international locations understand as disengagement from a conventional ally, the United States.

One supply near the matter advised Reuters in August any cope with Egypt would probably be part-financed by Gulf Arab states.

Egypt and Saudi Arabia agreed on the finish of July to work collectively to create a joint Arab army drive.

The Mistral is named the “Swiss army knife” of the French navy for its versatility. The sale will take the variety of French naval vessels bought to Egypt to seven in simply two years.

Egypt final 12 months purchased 4 small Gowind warships, constructed by Mistral producer DCNS, which is 64 p.c owned by the French state and 35 p.c by protection group Thales.

It additionally acquired a French frigate as a part of a 5.2 billion euro contract for twenty-four Rafale warplanes earlier this 12 months, France’s first abroad export of the fighter jet. ($1 = 0.8953 euros) (Additional reporting by James Regan; Editing by Tom Heneghan)