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20 August 2017
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France calculates loss from sale of Mistral to Egypt instead of Russia

France may lose up to EUR 250 million because of selling Egypt two Mistral-class helicopter carriers that were previously contracted to go to Russia, according to France's La Tribune.

REUTERS
REUTERS

The French newspaper cites the estimates announced by the French Senate's Finance Committee.

"If the framework agreement concluded with Egypt on the resale of the ships is implemented, it will cost the nation's budget from EUR 200 million to EUR 250 million," the committee's statement reads.

Chairman of the committee Dominique de Legge claims France's losses could have been about EUR 1.1 billion high if it had not been a deal with Egypt, and such losses would have pushed the deficit of the French budget up by EUR 556.7 million.

The agreement with Egypt entails additional spending, as the French authorities pledge to allocate EUR 150 million in state subsidies to French-based industrial group DCNS, which is the manufacturer of the Mistrals, to cover a gap between the original costs and their price for Egypt.

CNN earlier quoted a source close to French Minister of Defense Jean-Yves Le Drian saying that the two warships were to be sold to Egypt for around EUR 950 million ($1.06 billion) and delivered around March 2016. The sale amount included the costs of training of 400 Egyptian naval crewmen in the Saint-Nazaire shipyards in France, the source said.

The previous $1.3 billion contract with Moscow was signed in 2011 by the French government under Nicolas Sarkozy's presidency, but was suspended last year due to Russian aggression in eastern Ukraine.

The warships are powerful amphibious assault vessels equipped with six helicopter landing zones. Each of them can carry up to 16 heavy helicopters, along with tanks and about 500 troops.

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