Daily: 2.5 billion euro submarine deal lacks vital details

March 26, 2011, Saturday/ 18:36:00

A planned deal over the purchase of six submarines from a German company is lacking important details, including the price and the technical features of the submarines, the Bugün daily reported yesterday.

All eyes have turned to projects in the defense industry following a recent crisis involving over 100 F-35 fighter jets from the US, which refuses to share source code technology. Turkey has put a hold on the planned purchase of the jets due to this development.

The most defense agreement to garner the most attention is a submarine deal to be signed with a German company for the purchase of six U214 submarines. The daily reported that Turkey’s Undersecretariat of the Treasury had initially objected to the deal over the planned purchase of the submarines from German TyssenKrupp AG’s HDW company due to a high interest rate on payments, but was later persuaded. Speaking to Bugün, defense experts highlighted the unseen extra cost, which include the added amount predicted to be paid due to inflation and the amount to be paid for labor.

The extra cost is predicted to escalate by as much as 1 billion euros and to put the cost of the entire project at 3.5 billion euros once the production of the U214s is completed. The project has been criticized for the fact that Turkey will pay 375 million euros, while Greece paid 250 million euros for each one of the same submarines. The experts say the bill for one submarine will reach 600 million euros for Turkey with extra costs when the project is completed. Defense experts also underlined that there are no other countries in the world that would order six submarines at the same time. In the meantime, the company that is to produce the submarines for Turkey, HDW, is alleged to have bribed Argentinean, Portuguese, Colombian and Greek authorities for the sale of U209 and U214 submarines, according to German magazine Manager.

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