Sale of the Rafale to Egypt: Five reasons to put this sale in a dimmed light..
By
Valerie Lion released13.02.2015 at 15:55Updated at 17:12
Impossible not to rejoice at the first sale of the Rafale for export. This jewel of technology deemed unsaleable finally sold. However, this transaction with Egypt is a bit special and do not necessarily presage future success. Explanations.
Never a weapons contract has been concluded as quickly: three months! And for good reason, since there was no tender or put in competition with other Rafale combat aircraft.
The purchase by Egypt is a purely political act and choice of France sell in Cairo is not less, "This is a strong sign of support of France to the regime and its desire to help bring him what his defense," said
Loïc Tribot The Spière Delegate General of CEPS, a think tank specializing in defense. Clearly, Paris is committed to the Cairo side in the fight against Daech and answers on the international front, a politico-diplomatic emergency. The French Government responds on the home front, another emergency financial one: according to
the law on military programming underway in mid-2016 deliveries of Rafale to the French army should stop and export is supposed to take over.
Ironically: while Egypt was the first export customer for the Mirage 2000 in 1981, the country was not in Dassault leads past two years.The aircraft manufacturer had instead focused on
Brazil ,
India , the
Switzerland , the United Arab Emirates or Qatar. And as recounted CEO of Dassault Aviation on RTL this morning, the Defence Minister Jean-Yves Le Drian, who called this fall, saying: "Listen, I think Egypt has a real need for combat aircraft Rafale and is interested in. "
2. A contract won without competition
It is clear that the use of the Rafale theaters of operation in the Middle East for several years now has to demonstrate sized effectiveness. But the Rafale, always appreciated by the military because of its versatility, has not had for this sale to go through a complex and rigorous selection process, and will have escaped the gauntlet of the review budget by a government or a parliament: a boon because
it is the cost of acquiring and operating high which made him lose repeatedly contracts with its competitors in countries to open selection process as Brazil and Switzerland.
3. A favorable financing to the customer
"We clearly adapted the structure of supply to the customer's financial capacity," observes Loïc Tribot The Spière. To complete the sale to a country whose economy is bloodless, the French government has agreed to initiate Coface guarantee about half of the contract amount (excluding deposit, according to Les Echos).The deposit paid upon signing of the contract Monday, February 16, or at the latest within weeks, could be 10-15% of the total. The rest of the contract is to be financed by bank credit, with French institutions. The financial commitment seller's country is total.
4. No impact on the orders
For the manufacturer, the three aircraft delivered this year in Egypt before August so they can parade at the opening of the Suez Canal, will be paid on production initially intended for the army French. So there will be no increase in rates and eleven devices come out of the Merignac chain this year, as in previous. There will simply be a mechanical effect of substitution therefore by Dassault impact, either in terms of turnover or in terms of employment.However, if the contract with India -126 appliances, a new figure since the end of the Cold War - was signed this year, "there is size change," do we entrust internally. And hiring may be necessary.
5. A difficult business indeed to assess
Having secured a first export customer can only boost the image of the Rafale. However, this does not mean that other clients interested in the unit will buy faster. "The first sale abroad is a necessary but not sufficient," says Loïc Tribot The Spière.
In India, the only country to date to which Dassault entered into exclusive negotiations for a sale after a call for tenders, the length of the negotiations, which started three years ago now, is explained by the policy principle which provides
turnkey delivery of the first 18 aircraft and 108 other assembly on site, which means the
transfer of technology and agreement on the final responsibility of the manufacturer. The decision to Egypt to buy the Rafale is not expected to have any impact on this sensitive discussion.
Other interested countries,
Qatar could decide soon because it would be like for Egypt, a purchase without tender, namely the fact of the prince. But according to some experts, the Qataris may observe carefully the terms offered to Egypt and could take the opportunity to try to negotiate more advantageously their eventual contract.
