Greece-Arms Deals: Does Merkel Trade “2nd Bailout” for “60 Eurofighter”?

January 21, 2012 | Filed under: Geopolitics

From time to time there are similar leakages in the European media. That Greece’s lenders, preferably the Germans and the French, put Athens under pressure for lucrative arms deals. There has been talk about German submarines, French frigates and American Apache helicopters. The latest story by German Weekly DIE ZEIT  speaks of multi-billion-euro arms contracts, once the debt-ridden country receives the next aid tranche, estimated to be € 80 billion in  March 2012.

DIE ZEIT quoted an apparent middleman, a frequent visitor at the Greek Defense Ministry, making these allegations.

Fine Weapons for Athens – Frigates, tanks and submarines: Saving Packages By-Pass The Greek Military.  And Germany benefits.

The man knows the wish-list of the Greek Defense Ministry by heart: up to 60 fighter aircraft fighter for maybe € 3.9 billion. French frigates for about four billion euro,  patrol boats worth 400 million euros. So much is necessary for the modernization of the existing Greek fleet. Then it still lacks of ammunition for the Leopard tanks , but also two American Apache helicopters need to be replaced. Oh, and one would like to buy German U-boats, total price: two billion euros.

What the man,who goes in and out at Greece’s Defence Ministry, says sounds absurd. A State which is on the verge of bankruptcy and is supported by billions of the European Union wants to buy tons of weapons?The man in the Athens café is often seen in pictures next to generals of the Army or Defense officials, he often speaks with these guys on the phone, so he knwos what he’s talking about. He knows how sensitive the issue is, and would therefore not be named in the article. Even he holds these arms purchases as not communicable. But things could soon change, he says: “If Greece get paid the next tranche of aid, with € 80 billion expected, in March, there is a real opportunity to conclude new arms contracts.”

Quoting several Greek and German sources, DIE ZEIT wrote that the Greek government wanted to order 90 Eurofighters from Germany back in 1999 and that even than Foreign Minister Joschka Fisher (Greens) tried to persuade the Greeks. In fact, every once in a while the German government was trying to remind the Greeks of their Eurofighter needs.

Angela Merkel in the years 2005-2007.  Foreign Minister Guido Westerwelle (FDP) tried to secure the Eurofighters deal even in the spring 2010, just weeks before the Greek bankruptcy. The Greeks did not make any deal and few weeks later Westerwelle told a German newspaper that “Before there is any discussion about aid to Greece , that the country does its full homework on consolidation policy.”

Many German arms companies profited in the last years from the Greek defense needs: 223 Tanks-equipement Typ M109 and one Submarine (Class 214) total worth 403 million EUR, arrived in Greece in 2010! Krauss-Maffei Wegmann delivered 170 Leopard-2 Tanks for 1.7 billion EUR. Thyssen-Krupp delivered submarines, Eurocopter helicopters and Diehl BGT missiles.

Yes, Greeks are proud that their army is equipped with German products! But DIE ZEIT article triggered some negative reactions in Greece and three MPs from left-wing Democratic Left party, submitted a question to Defense Minister Dimitris Avramopoulos, asking whether such allegations are true and whether German Chancellor Angela Merkel has set the Eurofighters deal as precondition for the second bailout (Zougla.gr)

“Ptisi & Diastima”, the older and well respected Greek Defense magazine states:

“Today, there is not even the slightest indication of such deal. To those who check the facts even in a elementary way … the absurdness of this article becomes apparent. Nor the question in the Parliament can serve as any evidence to the truth of these allegations. In our opinion, this question is good proof of the contrary.”

Defencenet.gr, the website of another Greek Defense Magazine, contacted Die Zeit and the author of this article. Defencenet.gr in its article commenting this story says:

“Regarding the essence of the article, the € 4 billion cost for the purchase of 60 Eurofighter mentioned in the German newspaper is completely inaccurate. In the preliminary agreement signed in 2001 for the acquisition of 60 +30 Eurofighter aircraft the cost given for the 60 fighters was € 5.52 billion and this was in 2001!

The unit price of the aircraft in 2001 prices were close to €92 million and this is the cost of the aircraft alone, without his weapons, technical support and spare parts. In any case, the € 4 billion cost as stated in the ‘valid’ reportage of «Die Zeit» is not sufficient for the purchase of 60 Eurofighter aircraft, the unit price for which now reaches € 120 million without weapons and without support. In the agreement that Saudi Arabia recently signed for 72 Eurofighter the cost rouse to €15 billion (over € 200 million per unit!).

The fact is that for the next 10 years the HAF cannot acquire new fighter aircraft as it will raise the budget of the ministry to exceptional levels.

A senior officer of the HAF characterized the reports of the German newspapers «Kronen Zeitung» and «Die Zeit» “As noise without any substance”.

Indeed, typical of the inaccuracy (being polite here) of the «Die Zeit» article is that it states that the budget of the Greek Army rose by 18.2% (?) in 2012! When defencenet.gr shared the facts that the defense budget has declined by 35% from 2008 to 2012 to the journalist of the German newspaper in charge of financial reports her comment was … resounding silence …”

Full Die Zeit Article in google translation in ZeroHedge