Lockheed set to close Egypt F-16 sale

By Stephen Trimble

Lockheed Martin confirms that talks with Egypt to buy a seventh batch of F-16s are in the final stage of negotiations and a contract is expected imminently. The US Congress has already approved the sale of up to 24 F-16s as part of a programme called Peace Vector VII. The final negotiations, however, are for a reduced package of 20 F-16s, says Rick Groesch, Lockheed's regional vice-president for Middle East business development.

Groesch says F-16 orders are normally followed by deliveries starting 36 months later, but the final negotiations include discussions for accelerating the delivery schedule.

Egypt has purchased more than 220 F-16s since the Peace Vector series of contracts began in the early 1980s. Lockheed executives first indicated earlier this year that a follow-on deal with Egypt was likely. It was not clear until recently, however, if US policy would support additional F-16 sales.

But President Barack Obama's speech on Middle East policy in May was held in Cairo, elevating the US relationship with Egypt in regional issues.The Egypt deal follows relatively recent contracts signed by Oman and the United Arab Emirates for new F-16s. The UAE order introduced the Block 60 version. Oman's purchase, meanwhile, ushered in the Harpoon anti-ship missile for carriage by the F-16 fleet.

Lockheed currently has 76 F-16s in the order backlog, with deliveries scheduled up until 2012. Signing the deal with Egypt was critical to avoid a costly gap on Lockheed's production line. Lockheed also remains in talks with Iraq and Qatar in the region for new F-16 sales. Other countries, such as Oman and the UAE, have discussed follow-on F-16 purchases with Lockheed, Groesch said.

Middle East militaries are also keen, however, to move beyond so-called fourth-generation fighters, such as the F-16. A top UAE military officer on Saturday said he hoped his country would have a fifth-generation fighter within a couple years.

The US government has not previously identified any country in the Middle East other than Israel as a sales target for the Lockheed F-35 Joint Strike Fighter, although briefings dating back to 2002 listed the region in long-term sales projections.Groesch confirms that interest in the Middle East for the F-35 is real. "All the customers I talk to in the Gulf," he says, "want to fly the F-35."

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