November 16, 2015 / 8:35 AM / in 4 years

Turkey cancels $3.4 billion missile defense system tender: official

BELEK, Turkey (Reuters) - Turkey has canceled a $3.4 billion long-range missile defense system tender which was provisionally awarded to China, a move that had stirred U.S. and Western concern, an official at the Turkish prime minister’s office told Reuters on Sunday.

NATO member Turkey in 2013 had chosen China Precision Machinery Import and Export Corp as the preferred candidate for the deal, sparking Western worries over inherent security risks from Chinese technology.

“It has been decided that this tender will be canceled,” an official at Prime Minister Ahmet Davutoglu’s office said. “This decision has been signed off by the Prime Minister this week.”

An official from Turkey’s Defense Industry Undersecretariat, which has run the technical negotiations with China, said in July that a major stumbling block has been China’s reluctance to make a technology transfer which could give Turkey the knowledge to operate the system and eventually replicate it.

The prime ministry official said Ankara was now planning to go solo. “Turkey will now launch its own project to build such a defense system,” he said.

Chinese Foreign Ministry spokesman Hong Lei, asked about the tender being canceled, said on Monday he did “not have any knowledge on the relevant matter”. He did not elaborate.

Turkey had given mixed messages on whether it was planning to integrate the system with NATO infrastructure or not and U.S. and European allies has wanted Turkey to use a system that is compatible with NATO’s air defense.

During the tender, U.S. firm Raytheon (RTN.N) put in an offer with its Patriot missile defense system. Franco-Italian group Eurosam, owned by the multinational European missile maker MBDA and France’s Thales (TCFP.PA), came second in the tender.

Reporting by Orhan Coskun; Additional reporting by Michael Martina in Beijing; Writing by Humeyra Pamuk; Editing by Nick Tattersall and Jonny Hogg

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