Swiss referendum may derail fighter jet purchase

By Andrew Thompson

ZURICH (Reuters) - In neutral Switzerland, debate is raging over whether to replace 54 aging fighter jets, a potentially lucrative deal for European arms firms but one that could be shot down in a referendum.

Although no final decision is expected before 2010, the plan has already caused a stir, given Swiss aversion to expensive weapons in the absence of a concrete threat, the army's unpopularity, and a national reputation for thriftiness.

With a budget of 2.2 billion Swiss francs ($1.9 billion) to purchase up to 33 new aircraft, the deal is substantial both for Switzerland and for a defense industry hit by shrinking interest in preparing for Cold War dogfights.

The Swiss air force argues that its Northrop (NOC.N) F-5E/F Tigers, purchased in 1976 and 1981, no longer fit its needs.

"The Tiger has no guided missiles to be used in all weather conditions and at night, and its radar cannot pick up low-flying objects," said Kaj-Gunnar Sievert, spokesman for procurement agency Armasuisse.

Furthermore, the aircraft are increasingly affected by cracks and corrosion, Sievert said.

Boeing (BA.N) snubbed Switzlerand in April, citing the gap between the country's more modest requirements and Boeing's revamped F/A-18E/F Super Hornet. Switzerland already has an older version of the Hornet.

That leaves three European suitors: Sweden's Saab (SAABb.ST) JAS 39 Gripen, EADS's (EAD.PA) Anglo-German-Italian Eurofighter Typhoon and France's independent Rafale, built by Dassault Aviation (AVMD.PA) and urgently seeking its first foreign buyer.

The single-engined Gripen -- cheaper than its twin-engine rivals -- has taken an early lead after Saab secured an alliance with Swiss aircraft maker Pilatus. A deal could involve licensed production of the jets in Switzerland, Saab's Manne Koerfer said.

PUBLIC HOSTILITY

As the Swiss air force's rigorous testing program gets underway, the serenity of some of Switzerland's most beautiful Alpine landscapes will be disturbed by the thunder of military jets.

In February, Swiss voters defeated a referendum targeting a ban on fighter jet flights over tourist areas. But aircraft noise may cause a political backlash.

The government will announce a winner in July 2009, but parliamentary approval in Bern looks shaky as Switzerland's vociferous army critics are stepping up their campaign.

"The purchase is unnecessary from a security-political point of view. Fighter jets make too much noise and are damaging to the environment," said GSoA (Group for a Switzerland without an Army) secretary Patrick Angele.

When Switzerland last embarked on an arms deal of a similar size, in 1992, GSoA managed to secure 500,000 signatures against the purchase of 33 F/A-18 Hornets within one month, easily surpassing the 100,000 signatures needed to hold a referendum.