May 7, 2014 / 8:15 AM / in 4 years

UPDATE 1-China has not met Turkish missile defence tender terms-officials

* Turkey’s NATO allies concerned about potential deal with China

* Russian bid revised, but price remains much higher (Adds quote, background)

By Orhan Coskun

ANKARA, May 7 (Reuters) - The Chinese firm which won a provisional $3.4 billion bid to build a missile defence system for Turkey has not yet met all the conditions of the tender and Ankara may consider alternative offers, officials said.

A Russian bid has been revised but remains far higher than other offers, Turkish officials told Reuters late on Tuesday on condition of anonymity.

Awarding the tender to Russia would do little to ally concerns voiced by Turkey’s Western allies when Ankara said in September it had chosen China’s FD-2000 missile defence system.

It was chosen over rival offers from U.S. manufacturer Raytheon Co and Eurosam, which is owned by Franco-Italian missile maker MBDA and France’s Thales.

China had offered the most competitive terms and would allow co-production in Turkey, officials said at the time.

“The talks with China are continuing but an agreement has not yet been reached as the tender conditions have not been completely fulfilled,” one official close to the matter said, without elaborating on what those conditions were.

At the end of April a senior Turkish defence official said Ankara had extended the Eurosam and Raytheon bids by a further two months as they were due to expire.

A deal would mark a breakthrough for China in its bid to become an exporter of advanced weapons.

But Turkish officials have long said it was not a foregone conclusion that Ankara would end up signing the deal with China Precision Machinery Import and Export Corp (CPMIEC).

U.S. and NATO officials are unhappy with Turkey’s choice of CPMIEC, which is under U.S. sanctions for selling items to Iran, Syria and North Korea that are banned under U.S. laws designed to curb the proliferation of weapons of mass destruction. (Reporting by Orhan Coskun; Writing by Ayla Jean Yackley and Daren Butler; Editing by Jason Neely)

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