FARNBOROUGH, England (Reuters) - Taiwan’s state-owned aerospace company and Lockheed Martin Corp on Thursday said they had signed a memorandum of understanding to cooperate on upgrades of Taiwan’s 145 F-16 A/B fighter jets once Washington and Taipei finalize the deal.
Lockheed officials confirmed the news, which was announced in Taipei by Taiwan’s Aerospace Industrial Development Corp, a state-owned aerospace company, although the memorandum was signed at the Farnborough International Airshow on Wednesday.
The memorandum confirmed the AIDC’s “determination to work with Lockheed Martin” to meet the requirements of Taiwan’s Air Force on upgrading its aging F-16A/B fleet.
Under the memorandum, Lockheed will work with the Taiwanese company “on F-16 retrofit modifications, F-16 component parts manufacture and other potential offset projects.”
The memorandum comes when Taiwan and the United States are close to finalizing a deal to upgrade Taiwan’s 145 F-16A/B jet fighters at a cost of up to $5.3 billion.
A letter of acceptance on the larger weapons deal could be signed within weeks, said a source familiar with the matter.
The Obama administration approved the F-16 upgrades for Taiwan last September, upsetting China, but details of the actual government-to-government weapons sale are still being finalized.
Obama administration officials say the upgrade would give the planes essentially the same capabilities as new late-model F-16 C/Ds that Taiwan had sought to deter any attack.
China opposes U.S. arms sales to Taiwan on the grounds that they sabotage Beijing’s plans for reunification. China deems Taiwan a renegade province and has never renounced the use of force to bring the island under its control.
U.S. lawmakers sympathetic to Taiwan are pushing for Washington sell 66 new F-16s to Taiwan, in addition to the upgrades.
Reporting by Andrea Shalal-Esa, Editing by Gary Crosse