Egypt is considering purchasing two Meko A200 frigates from Germany’s ThyssenKrupp Marine Systems (TKMS) as discussions with France’s Naval Group on the acquisition of further Gowind corvettes grinds to a halt over cost concerns.
France’s La Tribune late last month reported that the German deal would be worth around 1 billion euros.
TKMS urgently needs additional sales after losing out on the German KS-180 vessel programme, which is worth some 3.5 billion euros.
La Tribune reports that the German government is offering attractive credit through financial company Euler Hermes, whereas the Naval Group is struggling with its credit offers.
Egypt will presumably opt for the Aster 30 missile manufactured by MBDA, but apparently, France will only sell this if it is used on Italian or French vessels, so Egypt would then be forced to make user of an alternative like the Umkhonto, as Algeria did.
In 2014 Egypt ordered four Gowind 2500 corvettes for around 1 billion euros, with one, El Fateh (971) built-in Lorient and the other three being built in Egypt. El Fateh was delivered to Egypt in October 2017. The contract made provision for an option for two more.
Germany is emerging as one of the new suppliers of military systems to Egypt, along with Russia and France. The German press has quoted members of the opposition and a Swedish monitoring body that have pointed to the growing role of Germany equipping Egypt with modern systems.
According to these reports, 35 requests for the export of German made defense systems to Egypt were approved in 2017 by the German government, and total defense exports to Egypt last year amounted to 708 million euros.
In the past five years, German defense exports to Egypt have jumped by 205%, compared with the total exports in the previous five years.
The main contracts are for the marine division of the company ThyssenKrupp, which last year provided a 250 million euro submarine (one of four submarines that the German government approved to supply to Egypt, at a cost of about one billion euros), Diehl Defence, which sold 330 air-to-air missiles to the Egyptian Air Force, Airbus Defense and Space, the Keller and Koch company, which produces light weapons, and Kraus-Maffei Wegmann (KMW), which manufactures armored personnel carriers and tanks.
The increase in the export of German arms to Egypt has continued in recent months. Experts say that the German attitude towards Egypt as a client for German made weapon systems has totally changed since the signing of a huge deal worth eight billion Euros in 2015 by Siemens, for the construction of two power stations in Egypt.
According to the Stockholm International Peace Research Institute (SIPRI), which published a report on the global defense industry earlier this month, arms sales to Egypt are part of the expansion of German defense exports to the Middle East and to North African countries in general. Between 2012 and 2017, according to the data, Berlin signed deals for the sale of arms to Egypt, Algeria, Tunisia and Morocco worth 11.2 billion Euros.
With regard to the Middle East, the export of German arms to this region has increased by 109% in the past five years, despite the decline in German exports to other regions. According to the research institute, about half of the weapons to the Middle East come from the United States and a quarter from Germany.
It is worth to mention that Egypt under al-Sisi’s regime is ranked the second among developing nations for importing arms in 2015 – buying almost $12 billion worth of arms, according to a new US congressional report.
According to the report, titled “Conventional arms transfers to developing nations, 2008-2015”, developing countries continued to be the biggest purchaser of arms in 2015.
The annual review is considered the most comprehensive assessment of global arms sales available in an unclassified form. The report adjusts for inflation, so the sales totals are comparable year to year.
IHS Inc., the leading global source of critical information and insight, also released a report stating that Egypt is the world’s fourth-largest defense importers. Egypt’s spending on military imports reached US$2.268 billion in 2015, according to the report.
Since Al-Sisi’s military coup in 2013, Egypt has accelerated has its arms deals.
Egypt’s entire defense budget is classified as a state secret and no details on defense spending are available.
Even basic information unrelated to defense is classified on the grounds of national security.
The defense budget estimated to be around $4.4 billion according to the Transparency International.