[A-List] EU integration struggles: CSDP

["Michael Keaney" <michael.keaney@xxxxxx>]

Britain's costs rise as Germans cut plane order

David Gow
Tuesday November 5, 2002
The Guardian

Britain is facing a Franco-German deal to cut the number of new military
transport aircraft that the cash-strapped Berlin government is due to order,
forcing the UK to pay more for its own batch of planes.

Geoff Hoon, the defence secretary, is to hold informal talks with his German
counterpart, Peter Struck, today on financing the long-delayed £11bn project
to build and deploy more than 200 A400Ms to airlift Europe's rapid reaction
force and military equipment to crisis regions.

The meeting comes after reports in both France and Germany last week that Mr
Struck and Michele Alliot-Marie, the French defence minister, had made a
deal to cut Germany's order from 73 to 60.

Ms Alliot-Marie reportedly told her German counterpart that Britain would
have to put up with the reduction in Berlin's order, raising new fears in
Whitehall about a Franco-German "stitch-up".

Germany, about to breach the 3% budget deficit ceiling laid down under
eurozone rules, has said publicly it wants to cut its A400M order. So far it
has set aside ?5.1bn (£3.2bn) in its depleted defence budget, enough to buy
just 40 planes, leaving a ?4.3bn funding gap.

The six-nation project, which would see Britain buy 25 planes and France 50,
is viewed in transatlantic military circles as a test of Europe's ability to
compete with the US's Boeing and Lockheed Martin and develop an independent
fighting force.

In Whitehall, where there is growing exasperation at the wrangling over
costs, the Ministry of Defence is still waiting for a formal German approach
to cut Berlin's order. Officials insist that a collective agreement among
the six partners is essential, not least because of the impact on prices.

Britain, under pressure from the US to abandon the A400M and buy Boeing or
Lockheed instead, wants an early agreement amid suggestions from the French
and German capitals that a deal should be struck before the Nato summit in
Prague on November 21.

The row over the A400M, the first military plane to be designed by Airbus
and due to enter service in 2010, threatens to spill over into other
European military projects such as the long-range Meteor missile planned for
the new-generation Eurofighter aircraft.