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EADS says Defense Contracts Finalized with Libya

AP
Friday, 3 Aug 2007 | 7:59 AM ET

European defense and aviation group EADS said Friday it had finalized two military contracts with Libya to supply anti-tank missiles and communications systems.

French Defense Minister Herve Morin said the contracts had not yet been formally signed, despite the comments of a Libyan official who said Thursday in Tripoli that Libya had signed the contracts.

A statement by EADS said a contract for Milan anti-tank missiles from its subsidiary MBDA reportedly worth $230 million " is today finalized after 18 months of discussions and negotiations." The statement said the deal was awaiting a signature from the Libyan side.

MBDA is a joint venture between EADS, Britain's BAE Systems and Italy's Finmeccanica.

A second contract for a Tetra advanced communications system reportedly worth $175 million is "in the process of being finalized," the EADS statement said.

The contracts mark a new step in Libya's bid to return to the international fold after years as a pariah state for sponsoring terrorism.

Word of the contracts follows President Nicolas Sarkozy's visit to Libya a day after six medics serving life sentences in Libya were freed and flew out of Libya to Bulgaria in the company of Sarkozy's wife Cecilia.

Freedom for the six had been the final obstacle for the West toward normalizing ties with Libya.

"This is an important deal because it is the first of its kind that Libya signed with a Western country since sanctions imposed in the early 1990s," the Libyan official said, speaking on condition he was not identified.

French authorities insist the contracts are not in exchange for freeing the five Bulgarian nurses and a Palestinian doctor jailed for 8 1/2 years and convicted on charges that they deliberately infected more than 400 school children with the AIDS virus.

However, lawmakers of both Sarkozy's conservative party and rival Socialistshave questioned the timing and criticized the transparency of the operation. Socialist Party leader Francois Hollande called Friday for an investigative commission into the deal.

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