Egypt Close to Order for 24 Rafales(Source: compiled by Defense-Aerospace.com; published Feb 06, 2015)
Egypt could become the first export customer for Dassault’s Rafale fighter, after a financing package was tentatively agreed this week by the two governments.
The deal will be signed if and when Egypt can make a €500 million down payment. (Dassault photo)
PARIS --- Egypt is close to signing a long-rumored order for 24 Dassault Rafale combat aircraft and one FREMM frigate, a package which according French media reports is worth €5 to €6 billion.
The order looks imminent as the French and Egyptian governments are reported to have reached a tentative agreement this week on the related financing package, during a visit here by an Egyptian government delegation. Rafale maker Dassault Aviation declined to comment on the deal, AFP wire service reported.
The agreement, reported Feb 05 by Paris business daily Les Echos, primarily revolves around the French export credit bank, COFACE, as cash-strapped Egypt does not have the money to pay for the entire package. COFACE will guarantee 50% of the deal’s value, down from the initial 80-90% requested by Egypt, and financing will be provided by a pool of French banks and possibly Saudi Arabia. Egypt has reportedly agreed to make a down payment of €500 million.
Egypt wants to have its first Rafales in service by August, for the inauguration of the expanded Suez Canal, and also wants early delivery of the frigate, which requires agreement of the financing package and contract signature in a matter of weeks.
The French government, whose multiyear defense budget depends on Rafale exports, has agreed to give Egypt an initial batch of Rafales already in service with its own air force, as well as the French navy’s llatest FREMM frigate, which is currently completing sea trials.
Meeting the delivery deadlines requested by Egypt depends, however, on whether and when it will make the down payment.
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