US, EU scrap for Gulf satellite deal
DUBAI (Scrap Monster): United States administration to ease export rules to compete with European firms to sell spy satellites to the United Arab Emirates. U.S. satellite-makers like Raytheon Corp. and Lockheed Martin have succeeded in convincing U.S. Administration on the matter.
Raytheon's entry to win the highly strategic contracts for a new military observation satellite will puts it in direct competition with the European aerospace giant European Aeronautics Defense and Space Co., which has been negotiating with the Emirates for two years.
The new negotiations involved the two contenders are closely followed by Saudi Arabia and Qatar. Both the countries are looking to equip themselves with surveillance satellites.
The Emirates deal winner will likely be well placed to secure similar deals with other Persian Gulf monarchies, all of the key allies in the U.S. confrontation with Iran in the region over Tehran's contentious nuclear program.
U.S. Forces, primarily naval and air power has been steadily building up by US administration, the gulf and its environs for several months but it has also been supplementing that by funneling advanced weapons and electronic systems into the gulf monarchies as well.
Including two Raytheon AN/TPY-2 long-range radars and 96 interceptors, a $3.48 billion deal for two batteries of its Terminal High Altitude Area Defense missile system has been signed by Lockheed on Dec. 25, 2011.
The Emirates had sought four batteries, with 144 interceptors and four radars for $6.9 billion but cut that back in 2010.
The deal marked the first foreign sale of THAAD and underlined U.S. efforts to beef up Arab defense capabilities in the gulf as tensions mounted with Iran over its expansionist policies in the region.
On the satellite competition the Americans find themselves up against stiff European opposition.
EADS' Franco-German aerospace subsidiary, Astrium, and Thales Alenia Space of Cannes, France, owned by Thales Aerospace of France and Finmeccanica of Italy, have an edge.
Astrium built the Emirates' Yahsat series of communications satellites used by the gulf state's military forces, with funding from the sovereign fund run by the Mubadala Development Co., based in Abu Dhabi, the oil-rich economic powerhouse of the seven-member federation.
The Emirates has established itself as the space technology hub in the region and has had dealings with foreign companies that specialize in military satellites.
The gulf state, a regional leader in the telecommunications sector, launched its first satellite, the 419-pound DubaiSat-1, July 29, 2001, from the Baikonur Cosmodrome in Kazakhstan, former center of the Soviet space program.
Largely due to dynastic squabbles within the alliance established in 1982 at the height of the 1980-88 Iran-Iraq war GCC military aims remain unfulfilled.
The growing tension between the GCC and Iran could provide the spur for them to set aside their differences and work together to develop their common military capabilities, and lessen dependence on the United States for early warning.
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