An Argentine judge has ordered Defense Minister Nilda Garre to be questioned over possible tax evasion in government weapons sales, in the latest corruption probe before October’s general election.
Garre said on Thursday she was not involved in any wrongdoing and called the court order politically motivated.
News of the summons came three days after Felisa Miceli was forced to resign as economy minister over an inquiry into some $60,000 found in a bag in her office.
In the arms case, a court is investigating whether a state-run company sold rifle parts to a U.S. company at prices well below the market rate. La Nacion newspaper reported the small, Connecticut-based company was owned by an Argentine.
The judge leading the probe is looking into allegations the weapons parts were undervalued to avoid customs taxes.
“I was summoned in writing to give information or evidence that I believe could help clarify the case,” Garre told reporters. “I don’t know what reasons the judge might have had, but anyone ... can see that the Defense Ministry’s potential responsibility is completely overblown.”
The investigation garnered attention on the same day that the first lady, Sen. Cristina Fernandez de Kirchner, was due to launch her presidential campaign.
Argentina’s election, scheduled for Oct. 28, is also for some provincial governors, legislators and other posts.
In May, President Nestor Kirchner fired two midlevel officials over alleged corruption on a government pipeline project. Another public works official resigned.
Earlier this month, Kirchner’s Cabinet chief was forced to publicly defend the environment secretary after a newspaper investigation accused her of hiring relatives and spending lavish amounts of government money.
Kirchner still enjoys high approval ratings despite the investigations and an unrelated energy crisis.
“We are in an electoral campaign, and it seems that some people believe any means can be used efficiently to sully a campaign that should be carried out with normality and respect,” Garre said.
Friday, July 20, 2007
Oboronprom Takes Control of Russia’s Mil Helicopter Plant
Russian state-controlled Oboronprom, the core company in the government-led consolidation of the national helicopter industry, announced July 12 it has taken majority ownership of Mil Moscow Helicopter Plant.
A subsidiary of Rosoboronexport, the state arms-trading monopoly, Oboronprom has acquired 25.07 percent of Mil from the Russian Abilis Holdings, according to an Oboronprom press release. Oboronprom already owned 36.35 percent of the Mil plant. Neither company would disclose the amount paid by Oboronprom.
The remaining shares of the Mil plant are spread among U.S. company Sikorsky International Operations (9.39 percent), Russian companies Energia (5.58 percent) and Pentapol (5.11 percent) and more than 4,600 private shareholders.
Created in 2002 and designated in a 2004 decree by President Vladimir Putin as the vehicle for consolidation of Russia’s helicopter-making industry, Oboronprom already controls the Ulan-Ude aviation plant, Vperyod Moscow machine-building plant and Stupino machine-building industrial enterprise.
By the end of 2007, Oboronprom plans to consolidate a controlling stake in two other helicopter producers:
• The Kazan aviation plant. Oboronprom now owns 29.92 percent, while Rosoboronexport has 21 percent. Russia’s TFK company, which is 50 percent-owned by the Kazan Helicopter Plant, holds 11.41 percent, with the remainder spread among more than 10,000 shareholders, including the government of Tatarstan.
• The Kamov plant. Oboronprom currently owns 49.46 percent in Kamov, while the state-owned MiG Corp. manages 49.64 percent.
By early 2008, Oboronprom plans to acquire a blocking stake in the Rostvertol helicopter plant, in which it currently owns 4.22 percent, while the governmental Federal Property Agency owns 3.44 percent. Forty-eight percent of Rostvertol’s shares are floated, and the remaining shares are owned by the company’s management.
In 2006, the enterprises that are slated to become part of the Russian helicopter-production holding rolled out 110 helicopters, earning more than $1.1 billion, according to Oboronprom.
A subsidiary of Rosoboronexport, the state arms-trading monopoly, Oboronprom has acquired 25.07 percent of Mil from the Russian Abilis Holdings, according to an Oboronprom press release. Oboronprom already owned 36.35 percent of the Mil plant. Neither company would disclose the amount paid by Oboronprom.
The remaining shares of the Mil plant are spread among U.S. company Sikorsky International Operations (9.39 percent), Russian companies Energia (5.58 percent) and Pentapol (5.11 percent) and more than 4,600 private shareholders.
Created in 2002 and designated in a 2004 decree by President Vladimir Putin as the vehicle for consolidation of Russia’s helicopter-making industry, Oboronprom already controls the Ulan-Ude aviation plant, Vperyod Moscow machine-building plant and Stupino machine-building industrial enterprise.
By the end of 2007, Oboronprom plans to consolidate a controlling stake in two other helicopter producers:
• The Kazan aviation plant. Oboronprom now owns 29.92 percent, while Rosoboronexport has 21 percent. Russia’s TFK company, which is 50 percent-owned by the Kazan Helicopter Plant, holds 11.41 percent, with the remainder spread among more than 10,000 shareholders, including the government of Tatarstan.
• The Kamov plant. Oboronprom currently owns 49.46 percent in Kamov, while the state-owned MiG Corp. manages 49.64 percent.
By early 2008, Oboronprom plans to acquire a blocking stake in the Rostvertol helicopter plant, in which it currently owns 4.22 percent, while the governmental Federal Property Agency owns 3.44 percent. Forty-eight percent of Rostvertol’s shares are floated, and the remaining shares are owned by the company’s management.
In 2006, the enterprises that are slated to become part of the Russian helicopter-production holding rolled out 110 helicopters, earning more than $1.1 billion, according to Oboronprom.
Saturday, July 7, 2007
US troubles in landing Turkish defense contracts set to continue
During a March 15 hearing in Congress, a senior Pentagon official criticized Ankara's defense acquisition policies in unusually candid language, saying the present approach by the Turkish procurement agency “is hindering Turkey's military modernization, interoperability with NATO allies and U.S.-Turkey defense industry cooperation.""Onerous terms and conditions – liability, work share, technology transfer, and upfront U.S. government approval requirements in Turkey's standard contracts – have kept U.S. firms from bidding," Dan Fata, deputy assistant secretary of defense for Europe and NATO, told the hearing on U.S.-Turkish relations at the House of Representatives' Committee on Foreign Affairs.Since then, U.S. concerns voiced by Fata have remained in place, with Ankara selecting non-U.S. suppliers in three critical programs altogether worth billions of dollars over a decade. And the future does not look bright for potential American commercial sales to Turkey.To avoid misunderstandings in evaluating the current status of Turkish-U.S. defense industry relations, the relationship's foundations should be first analyzed correctly. It is a two-fold relationship: First, Turkey's government-to-government purchases from the United States, based on a Foreign Military Sales (FMS) mechanism; and second, commercial sales in which US companies usually have to compete against rivals from other countries. It is the second category where the Americans face problems.The United States has been Turkey's closest Western partner and largest weapons supplier in modern times. Each year Turkey buys defense equipment worth more than $1 billion from the United States on the FMS scheme. FMS loans are U.S. government credits designed to enable allied nations to buy U.S. defense equipment.And such government-to-government weapons sales will continue to flourish, with Turkey set to buy new aircraft and related fighter services worth nearly $15 billion over the next 10 to 15 years.
Lucrative FMS deals:
Those deals include a Turkish plan to buy 100 next generation F-35 Joint Strike Fighter jets worth $10.7 billion; an agreement for the sale to the Turkish Air Force of 30 F-16 Block 50 fighters worth $1.85 billion; and an ongoing modernization of older Turkish F-16s for $1.1 billion. In all these cases, U.S. Lockheed Martin is the prime contractor.
In addition, Turkey continually buys various types of Air Force and naval missiles and other related services under FMS deals with the United States.Now back to commercial programs. In the 2000s, U.S. companies have managed to secure only two major direct commercial sales: First a nearly $1.6 billion contract with Boeing in 2002 for four airborne early warning and control (AEW&C) aircraft (which is faltering, bythe way, with huge delivery delays because of Boeing's bad planning); and a $580 million agreement with Sikorsky Aircraft last year for 17 S-70B Seahawk naval warfare helicopters. Sikorsky is the only major U.S. survivor in the rocky Turkish defense market in terms of commercial sales.But in major commercial deal decisions over the past few months only, the Turkish government and military opted for non-U.S. solutions for attack helicopters, training aircraft and a model for main battle tanks.Earlier this year, the Defense Industry Executive Committee, Turkey's top decision-making body on defense procurement whose members include the prime minister, the chief of the general staff and the defense minister, selected the Italian-British AgustaWestland, maker of the A-129 Mangusta International, over South African rivals. The program is estimated to cost $2.7 billion for 90 platforms.And in late June the Executive Committee opted for South Korean solutions for the tank and trainer aircraft programs.The trainer aircraft program is worth about $450 million and involves up to 54 platforms. Ankara awarded the deal to Korea Aerospace Industries (KAI), maker of the KT-1 Woongbi, which beat the Super Tucano from Brazil's Embraer.
US faltering in commercial sales:
On the tank program, South Korea's XK-2 platform, developed by the Agency for Defense Development, was chosen as the model on which Turkey's new main battle tank would be based.Turkish officials said that the fresh business for Korean companies may easily exceed $1 billion as the tank program would most likely involve several follow-on contracts. U.S. companies were non-players in these three competitions. Boeing, maker of the U.S. Army's AH-64D Apache Longbow, and Bell Helicopter Textron, maker of the U.S. Marine Command's AH-1Z, could not bid for the attack helicopter contract, and Raytheon failed to take part in the trainer aircraft competition, all blaming the Undersecretariat for Defense Industries (SSM), Turkey's procurement agency, for drafting strict terms and conditions for program specifications, which they said were incompatible with U.S. export laws and regulations.And two years ago, U.S. General Atomics lost a major contract on Turkish unmanned aerial vehicles to the Israeli Aircraft Industries.The target of criticism by Pentagon's Fata, other officials and U.S. companies, SSM rejects the charges. SSM chief Murad Bayar says his undersecretariat has greatly softened its terms and conditions to enable U.S. participation in Turkish programs, but American officials say the changes in Turkish specifications are cosmetic and not sufficient for their participation."We have done what we can. Other countries do not have such complaints, and can easily bid for our programs," countered one SSM official.
Undeclared policy?
"The Turks are sick and tired of the United States' notorious restrictions on technology transfer and strict rules of export, which have caused so many problems for Turkey in past years," said one Turkish defense analyst. "So in a kind of undeclared policy, the Turks are now selecting non-U.S. suppliers whenever they can, to avoid hassle with the Americans.
They are effectively saying, 'OK, if I can buy this system from this or that country, why should I beg you?'"SSM is happy with the Ankara government's selections in the recent commercial sale programs, and has no plans to further soften its rules to meet U.S. demands for many future programs. That means the United States may have no chance to sell defense systems that arealso offered by companies from other countries meeting Turkish requirements, the analyst said.But there are exceptions. For future commercial sales, U.S. military helicopters appear to be items that Turkey likely will continue to buy. For example, in ongoing competition between U.S. and European companies for 32 military utility helicopters worth more than $500 million, Ankara is expected to buy versions of Sikorsky's S-70 Black Hawk, continuing its tradition for this platform.Also Turkey in the longer term plans to buy up to 10 heavy lift helicopters, and Boeing's CH-47 Chinook has emerged as the strongest candidate.
Except for the United States and Russia, no other country manufactures heavy lift helicopters, and Russian equipment is incompatible with Turkey's NATO-based systems.In another example, the Raytheon/Lockheed group, maker of the Patriot PAC-3 systems, is expected to compete with Russian rivals marketing the S-300 or S-400 systems for Turkey's $1.3 billion program for anti-missile air defense systems. For the Russian option there is a compatibility problem, but Greece, another NATO member, has been operating the S-300s.So in the foreseeable future, Turkey will continue to buy U.S. systems when it specifically needs them, but may opt for other solutions whenever it can, as seen in several recent examples.
Lucrative FMS deals:
Those deals include a Turkish plan to buy 100 next generation F-35 Joint Strike Fighter jets worth $10.7 billion; an agreement for the sale to the Turkish Air Force of 30 F-16 Block 50 fighters worth $1.85 billion; and an ongoing modernization of older Turkish F-16s for $1.1 billion. In all these cases, U.S. Lockheed Martin is the prime contractor.
In addition, Turkey continually buys various types of Air Force and naval missiles and other related services under FMS deals with the United States.Now back to commercial programs. In the 2000s, U.S. companies have managed to secure only two major direct commercial sales: First a nearly $1.6 billion contract with Boeing in 2002 for four airborne early warning and control (AEW&C) aircraft (which is faltering, bythe way, with huge delivery delays because of Boeing's bad planning); and a $580 million agreement with Sikorsky Aircraft last year for 17 S-70B Seahawk naval warfare helicopters. Sikorsky is the only major U.S. survivor in the rocky Turkish defense market in terms of commercial sales.But in major commercial deal decisions over the past few months only, the Turkish government and military opted for non-U.S. solutions for attack helicopters, training aircraft and a model for main battle tanks.Earlier this year, the Defense Industry Executive Committee, Turkey's top decision-making body on defense procurement whose members include the prime minister, the chief of the general staff and the defense minister, selected the Italian-British AgustaWestland, maker of the A-129 Mangusta International, over South African rivals. The program is estimated to cost $2.7 billion for 90 platforms.And in late June the Executive Committee opted for South Korean solutions for the tank and trainer aircraft programs.The trainer aircraft program is worth about $450 million and involves up to 54 platforms. Ankara awarded the deal to Korea Aerospace Industries (KAI), maker of the KT-1 Woongbi, which beat the Super Tucano from Brazil's Embraer.
US faltering in commercial sales:
On the tank program, South Korea's XK-2 platform, developed by the Agency for Defense Development, was chosen as the model on which Turkey's new main battle tank would be based.Turkish officials said that the fresh business for Korean companies may easily exceed $1 billion as the tank program would most likely involve several follow-on contracts. U.S. companies were non-players in these three competitions. Boeing, maker of the U.S. Army's AH-64D Apache Longbow, and Bell Helicopter Textron, maker of the U.S. Marine Command's AH-1Z, could not bid for the attack helicopter contract, and Raytheon failed to take part in the trainer aircraft competition, all blaming the Undersecretariat for Defense Industries (SSM), Turkey's procurement agency, for drafting strict terms and conditions for program specifications, which they said were incompatible with U.S. export laws and regulations.And two years ago, U.S. General Atomics lost a major contract on Turkish unmanned aerial vehicles to the Israeli Aircraft Industries.The target of criticism by Pentagon's Fata, other officials and U.S. companies, SSM rejects the charges. SSM chief Murad Bayar says his undersecretariat has greatly softened its terms and conditions to enable U.S. participation in Turkish programs, but American officials say the changes in Turkish specifications are cosmetic and not sufficient for their participation."We have done what we can. Other countries do not have such complaints, and can easily bid for our programs," countered one SSM official.
Undeclared policy?
"The Turks are sick and tired of the United States' notorious restrictions on technology transfer and strict rules of export, which have caused so many problems for Turkey in past years," said one Turkish defense analyst. "So in a kind of undeclared policy, the Turks are now selecting non-U.S. suppliers whenever they can, to avoid hassle with the Americans.
They are effectively saying, 'OK, if I can buy this system from this or that country, why should I beg you?'"SSM is happy with the Ankara government's selections in the recent commercial sale programs, and has no plans to further soften its rules to meet U.S. demands for many future programs. That means the United States may have no chance to sell defense systems that arealso offered by companies from other countries meeting Turkish requirements, the analyst said.But there are exceptions. For future commercial sales, U.S. military helicopters appear to be items that Turkey likely will continue to buy. For example, in ongoing competition between U.S. and European companies for 32 military utility helicopters worth more than $500 million, Ankara is expected to buy versions of Sikorsky's S-70 Black Hawk, continuing its tradition for this platform.Also Turkey in the longer term plans to buy up to 10 heavy lift helicopters, and Boeing's CH-47 Chinook has emerged as the strongest candidate.
Except for the United States and Russia, no other country manufactures heavy lift helicopters, and Russian equipment is incompatible with Turkey's NATO-based systems.In another example, the Raytheon/Lockheed group, maker of the Patriot PAC-3 systems, is expected to compete with Russian rivals marketing the S-300 or S-400 systems for Turkey's $1.3 billion program for anti-missile air defense systems. For the Russian option there is a compatibility problem, but Greece, another NATO member, has been operating the S-300s.So in the foreseeable future, Turkey will continue to buy U.S. systems when it specifically needs them, but may opt for other solutions whenever it can, as seen in several recent examples.
Australia, US concerned over China's military buildup
Australia and a top U.S. military official expressed concern Thursday that China's rapid military buildup and use of a missile in space could
add to instability in the Asia-Pacific, and backed a greater role for Japan in regional security.
Releasing his government's first defense policy update since 2005, Prime Minister John Howard said China's economic rise was good for the world, but added a caution
that it was also a pivotal player in several tense issues in the region.
"The pace and scope of its military modernization, particularly the development of new and disruptive capabilities such as the anti-satellite missile, could create misunderstandings and instability in the region," the policy report said.
The policy brings Canberra closely into line with Washington, which has expressed similar concerns about China's military expansion. The two are already close allies, with a defense pact and Australian contributions to U.S.-led operations in Iraq and Afghanistan.
Separately Thursday, the commander of the United States' Japan-based naval battle group voiced Washington's concern about China rapid military expansion.
"Certainly we are a bit wary of China," Rear Adm. Rick Wren, the commander of the aircraft carrier USS Kitty Hawk's battle group, told The Associated Press. "They seem
to be fairly opaque in communicating what they intend to do with this large military buildup."
Wren, speaking aboard the carrier as it came into Sydney Harbor for a port visit, said the United States wants China to become a stabilizing force in Asia.
"Certainly we need them to be a stabilizing force in this region," he said. "But until we can actually define that, we will continue to practice our skills and be ready for
whatever the president calls on us to do."
More than 5,000 U.S. sailors were due to take shore leave in Sydney after completing the Talisman Saber exercises, a biennial event that this year pitted 20,000 U.S. troops and
7,500 Australian forces and dozens of ships and planes against fictional enemies in a variety of land and sea-based scenarios off Australia's northeastern coast.
Japan took part in the Talisman Saber exercises as an observer, and Wren said Japan would take a "much bigger" role in future exercises. He did not elaborate.
"The importance of multilateral alliance in this theater is very important," Wren said. "What we both want to do is expand that in the interest of creating a stronger and
long-lasting regional stability, and so we are bringing in many other nations."
Cooperation could include non-combat roles such as disaster relief and other humanitarian operations, he said.
The Australian policy document said cooperation between Australia, Japan and the United States would become increasingly important in maintaining stability in Asia,
and noted "Australia has no closer nor more valuable partner in the region than Japan."
"Japan's more active security posture within the U.S. alliance and multinational coalitions is in keeping with its economic and diplomatic weight," it said.
Howard said China's economic rise was good for the world, but that "U.S.-China relations, China-Japan tensions and long-standing flash points in Taiwan and the Korean
peninsula will require continuing careful management."
The report said mishandling tensions between Taiwan and China could have "disastrous consequences for the region."
The United States and Japan are stepping up efforts to build a joint missile defense system in Asia, partly as a bulwark against regional threats such as a nuclear-armed
North Korea. Australia, a steadfast U.S. ally that has about 2,000 troops in Afghanistan and Iraq, is studying whether to participate in the defense shield.
Australia and Japan signed a security agreement in March that will enable Japanese forces to train alongside Australians for disaster relief and peacekeeping missions,
and boost cooperation between the two countries in counterterrorism measures and intelligence sharing.
add to instability in the Asia-Pacific, and backed a greater role for Japan in regional security.
Releasing his government's first defense policy update since 2005, Prime Minister John Howard said China's economic rise was good for the world, but added a caution
that it was also a pivotal player in several tense issues in the region.
"The pace and scope of its military modernization, particularly the development of new and disruptive capabilities such as the anti-satellite missile, could create misunderstandings and instability in the region," the policy report said.
The policy brings Canberra closely into line with Washington, which has expressed similar concerns about China's military expansion. The two are already close allies, with a defense pact and Australian contributions to U.S.-led operations in Iraq and Afghanistan.
Separately Thursday, the commander of the United States' Japan-based naval battle group voiced Washington's concern about China rapid military expansion.
"Certainly we are a bit wary of China," Rear Adm. Rick Wren, the commander of the aircraft carrier USS Kitty Hawk's battle group, told The Associated Press. "They seem
to be fairly opaque in communicating what they intend to do with this large military buildup."
Wren, speaking aboard the carrier as it came into Sydney Harbor for a port visit, said the United States wants China to become a stabilizing force in Asia.
"Certainly we need them to be a stabilizing force in this region," he said. "But until we can actually define that, we will continue to practice our skills and be ready for
whatever the president calls on us to do."
More than 5,000 U.S. sailors were due to take shore leave in Sydney after completing the Talisman Saber exercises, a biennial event that this year pitted 20,000 U.S. troops and
7,500 Australian forces and dozens of ships and planes against fictional enemies in a variety of land and sea-based scenarios off Australia's northeastern coast.
Japan took part in the Talisman Saber exercises as an observer, and Wren said Japan would take a "much bigger" role in future exercises. He did not elaborate.
"The importance of multilateral alliance in this theater is very important," Wren said. "What we both want to do is expand that in the interest of creating a stronger and
long-lasting regional stability, and so we are bringing in many other nations."
Cooperation could include non-combat roles such as disaster relief and other humanitarian operations, he said.
The Australian policy document said cooperation between Australia, Japan and the United States would become increasingly important in maintaining stability in Asia,
and noted "Australia has no closer nor more valuable partner in the region than Japan."
"Japan's more active security posture within the U.S. alliance and multinational coalitions is in keeping with its economic and diplomatic weight," it said.
Howard said China's economic rise was good for the world, but that "U.S.-China relations, China-Japan tensions and long-standing flash points in Taiwan and the Korean
peninsula will require continuing careful management."
The report said mishandling tensions between Taiwan and China could have "disastrous consequences for the region."
The United States and Japan are stepping up efforts to build a joint missile defense system in Asia, partly as a bulwark against regional threats such as a nuclear-armed
North Korea. Australia, a steadfast U.S. ally that has about 2,000 troops in Afghanistan and Iraq, is studying whether to participate in the defense shield.
Australia and Japan signed a security agreement in March that will enable Japanese forces to train alongside Australians for disaster relief and peacekeeping missions,
and boost cooperation between the two countries in counterterrorism measures and intelligence sharing.
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