By Pierre Tran
Paris – France welcomed May 4 an Egyptian announcement of an order for a further 30 Rafale fighter jets and weapons from Dassault Aviation, MBDA and Safran, confirming a news report on Disclose, a French campaigning website.
“The armed forces minister, Florence Parly, welcomes the latest export success of the Rafale for Egypt,” the ministry said in a statement.
“Egypt, which was the first export client for the Rafale with a contract signed in February 2015, announced the signature of three contracts with Dassault Aviation, MBDA and Safran, for the delivery of 30 more aircraft, and related equipment.”
The Egyptian deal was worth a total €3.95 billion ($4.7 billion), with €3.75 billion for the Rafales, and €200 million for weapons from MBDA and Safran Electronics & Defense, the website Disclose reported May 3.
Cairo’s order for 30 Rafale follows the first batch of 24 fighters in the 2015 arms deal, which included a French multi-mission frigate.
“We @byMBDA welcome the sale to Egypt of 30 Rafale and associated equipment, a further step of our long cooperation with the Egyptian Armed Forces,” MBDA said on social media. An MBDA spokesman declined further comment.
MBDA will supply Egypt the Mica NG air-to-air missile, but the arms package excludes Meteor and Scalp missiles as these long-range weapons rely on US components covered by the international traffic in arms regulations, website La Tribune reported. Safran Electronics & Defense will supply its AASM powered smart bomb.
The Safran unit was not available for comment.
The Rafale contract was expected to come into effect in June or July, La Tribune reported, with first delivery of the fighter in 3-1/2 years, over 2024-2026.
Egypt had intended to keep the fighter deal quiet, Disclose reported, with al-Sisi seeking discretion on the contract signed April 26. That signing was to be followed by an Egyptian delegation arriving here on May 4, to sign a financial agreement at the French finance ministry, at Bercy.
Because Egypt is heavily indebted, the acquisition will be financed by a bank loan backed by France for up to 85 percent of the total amount, Disclose reported. France will effectively provide export credit guarantee on loans from a pool of French banks which included BNP, CIC, Credit Agricole, and Societé Générale.
The client nation pays a down payment of 15 percent of the total amount to qualify for the 85 percent credit guarantee.
That state guarantee meant French taxpayers would pay back the bank lenders €3.4 billion if Egypt failed to make the payments, the website reported.
An 85 percent of export credit guarantee was the standard rate for deals, a banker said. A 60 percent guarantee on the 2015 deal meant Egypt had to pay 40 percent in cash.
The leaking of the Egyptian order to a campaigning website was seen as an attempt to derail the deal.
“It was not neutral,” the banker said.
Cairo’s acquisition signalled a return to good relations after the French president, Emmanuel Macron, awarded the highest order of merit, the Legion d’Honneur, to his Egyptian counterpart, Abdel Fattah al-Sisi, when he visited France in December 2020, afternoon daily Le Monde reported.
That return to favor was seen as needed after Macron criticized Egypt’s human rights record when he gave a joint press conference in Cairo in 2019. France failed to win arms deals after what was seen as a diplomatic blunder.
The Rafale deal underscored the “strategic and military partnership between France and Egypt,” the ministry said.
Dassault welcomed news of the order, pointing out that the latest order meant the Egyptian air force would fly 54 Rafale, making that service the second largest operator of the fighter after the French air force.
“It emphasizes also the confidence of the highest Egyptian authorities in Dassault Aviation and their satisfaction with the effective execution of the first contract,” the company said in a statement.
A French parliamentary report on arms exports, with a special section on Egypt, called for parliament to be involved in authorizing foreign arms sales, Disclose reported.
The lower house National Assembly published Nov. 18 a report from Jacques Maire and Michèle Tabarot of the finance committee, pointing up the lack of financial information on foreign arms deals.
“Your rapporteurs calls for the creation of a parliamentary delegation for the scrutiny of arms exports,” the report said.