Two US defence firms vie for Taiwan's 12 P3-C contract

Oct 21, 2006, 14:31 GMT

Taipei - Two US defence firms are vying for the 1.2-billion-US-dollar contract to supply 12 P3-C anti-submarine airplanes to Taiwan, a newspaper said on Saturday.

The United Evening News (UEN), quoting an unmamed military source, said both Lockheed Martin and L-3 Communications are competing for the P3-C deal, which is part of the 14.5-billion-US dollar arms sale package approved by President George W Bush in 2001.

The arms sale also includes eight conventional submarines and six PAC-III anti-missile batteries. Taiwan's Defence Ministry has made the budget for them but lawmakers have blocked the passing of the budget, citing the high prices and late delivery.

According to the UEN, Taiwan intends to award the contract to Lockheed Martin which has manufactured P3-Cs for the US Navy and is a long-term arms supplier to Taiwan. But L-3 Communications is pressing Taiwan to find a supplier through open bidding.

L-3 Coommunications has hired former US deputy secretary of state Richard Armitage to lobby Taiwan to launch open bidding for the P3-C purchase.

Armitage has written to President Chen Shui-bian, Parliament Speaker Wang Jin-pyng and Defence Minister Lee Jye.

'He argued that by launching open bidding, Taiwan get lower price quote and better quality,' UEN said.

Armitage assured Taiwan that L-3 can prove itself as a competant supplier of P3-Cs becaue it has upgraded P3 aircrafts for Australia, New Zealand and South Korea.

Armitage was friendly towards Taiwan during his term, 'so his lobbying has created a lot of pressure for Taiwan authorities,' UEN said.

The Taiwan parliament will resume debate on the arms purchase budget next week.