Turkey drives hard bargain over crucial missile deal

ANKARA - Turkey has alarmed fellow NATO members by raising the prospect of handing China a multi-billion dollar missile contract, yet the long-running saga is far from over and Ankara may just be trading for a better deal.

Turkey, NATO's only Muslim member, entered discussions in 2013 with the China Precision Machinery Export-Import Corporation (CPMIEC) over its first anti-missile system, a contract worth US$3.4 billion (S$4.6 billion).

French-Italian consortium Eurosam and US-listed Raytheon Co have also submitted offers, but several recent statements by Turkish officials have indicated the Chinese may be the front-runner.

Defence Minister Ismet Yilmaz, in a written answer to a parliamentary commission, sparked speculation that CPMIEC was the winner by saying no new official bid had been received from rivals and its system could be used without integrating with NATO systems.

Yet there are serious concerns over the compatibility of CPMIEC's systems with NATO missile defences, as well as strategic worries about a key member of the military alliance concluding such a big deal with Communist-ruled China.

Other officials said talks were continuing with all bidders.

"This is not a done deal," said Sinan Ulgen, visiting scholar at Carnegie Europe in Brussels.

"It is totally wrong to assume that Turkey made its final decision to buy missile defence systems exclusively from China. American and European firms are still in the game," he told AFP.

Nihat Ali Ozcan, security expert at the Ankara-based TEPAV think tank, said Turkey was doing all it could to secure a better deal by promoting the Chinese bid.

"Talks are continuing at the bargaining table. We are talking about a lucrative deal," he said. "In my opinion, the Europeans and the Americans are the frontrunners, not the Chinese."

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Turkey drives hard bargain over crucial missile deal