EU-US tanker contract spat to have 'consequences'
Photo Boeing KC-135 Stratotanker
(PARIS) - Claims the Pentagon skewed bidding rules for a tanker jet contract in favour of an American manufacturer will have serious consequences for EU-US relations, senior French officials said Wednesday.
US aerospace giant Boeing is set to win a 35 billion dollar (26 billion euro) contract to build an aerial refueling tanker plane for the US air force after Northrop Grumman and its European partner EADS dropped out.
Both European officials and EADS, which owns planemaker Airbus, claim that the Pentagon altered bidding rules for the contract in order to favour Boeing's all-American offer over the European bid.
A government spokesman added that French President Nicolas Sarkozy will bring up the subject when he visits his US counterpart Barack Obama next month.
"This is a serious matter," another government member, France's Minister for Europe Pierre Lellouche, told reporters after a meeting of President Nicolas Sarkozy's cabinet.
"Naturally, we're talking about the arms market, so it's not a classic matter of international law and the World Trade Organisation, but we're going to respond," he said, without saying what France's response would be.
"I can assure you that there will be consequences. The president will act on the matter at the appropriate time. This matter is in no way finished."
Government spokesman and Education Minister Luc Chatel said Sarkozy will have "the chance to discuss this question with President Obama during his visit to the United States" later this month.
Lellouche added: "I've always been in favour of a strong Europe in the Atlantic alliance but it's something that has to work both ways.
"It's obvious that if we bend to the Pentagon's fait accompli and if no-one says anything, then Europe's credibility is finished. Europe has to exist and therefore its industry has to exist and make itself respected," he said.
The Pentagon insists that the bidding process was fair and that it will buy the aircraft that best fits the needs of the air force for the price.
But the European Commission has protested and a German minister has accused the United States of protectionism, warning that Berlin would take up the issue at the political level and at the World Trade Organisation.
Text and Picture Copyright 2010 AFP. All other Copyright 2010 EUbusiness Ltd. All rights reserved. This material is intended solely for personal use. Any other reproduction, publication or redistribution of this material without the written agreement of the copyright owner is strictly forbidden and any breach of copyright will be considered actionable.