ABU DHABI, United Arab Emirates, Oct. 17 (UPI) -- France was reported Monday to be in the final stages of wrapping up a $10 billion contract with the United Arab Emirates for 60 Rafale combat jets.
That would be a crucial breakthrough for French manufacturer Dassault Aviation, which has been struggling for years to find its first foreign buyer for the multi-role fighter.
"We're in the final negotiations," French Defense Minister Gerard Longuet told France's LCI television, adding that the prospect of a deal was "very strong."
He indicated that Dassault probably had to make major concessions to close the deal with the Emirates, which had been demanding improved weapons and electronics since negotiations began in 2008.
"It's a significant deal for this country," Longuet said. "When you equip an air fleet, it's for 40 years, so the buyer sets his conditions."
The Emirates particularly wanted a more powerful M88 engine from Snecma of France's Safran Group, which is considered better suited for desert conditions, and a higher performing radar system from Thales.
Financing these modifications "is one of the issues under discussion," a senior Dassault executive disclosed in February.
Sheik Mohammed bin Zayed al Nahyan, commander of the Emirates' armed forces, broke off negotiations in the summer of 2010, apparently because of leaks on the discussions by the French.
Sheik Mohammed, who is also crown prince of Abu Dhabi, the oil-rich emirate that dominates military affairs, jolted the French by approaching Boeing in August 2010 about a possible deal on the F/A-18E/F Super Hornet, possibly to determine what technology would be available.
France then agreed Jan. 3 to clear the acquisition of 200 Meteor over-the horizon air-to-air missiles produced by MBDA for the possible Rafale sale.
For the French, the Emirates deal is critical because they have invested so much political capital and effort into the sale.
A senior delegation from Dassault traveled to Abu Dhabi, the emirates' economic powerhouse, which controls arms procurement, Sept. 3 to step up the company's bid to secure a deal for the Rafale.
The aircraft is the standard bearer for the French aerospace industry, showcasing Dassault's capabilities as designer and manufacturer of cutting-edge fighters.
Other French defense companies also have a lot riding on the Rafale sale, such as MBDA, which anticipates further export orders for the Meteor and other missiles, if it goes through.
Dassault is desperate to sign on its first foreign buyer. The Rafale is also in a contender in multibillion-dollar fighter contests in Brazil, India and Switzerland.
The Emirates also seek to outfit the Dassault jets with active electronically scanned radar, the Damocles targeting pod and the Reco NG reconnaissance pod.
In April, the French deployed a flight of Rafale F3 jets equipped with the Reco NG and Damocles at a French base in Abu Dhabi to demonstrate the systems.
The base at Al Dhafra, France's only military foothold in the Persian Gulf, was inaugurated in 2010 by French President Nicolas Sarkozy in a personal bid to boost the Rafale contract.
Another demand by the Emirates was that France find a buyer for the 63 Dassault Mirage 2000-9 fighters Abu Dhabi bought in 1983, which the Rafales are intended to replace.
The Emirates has also looked at Lockheed Martin's F-16 as a possible contender to replace the Mirages. Lockheed offered to provide the Emirates with late-model F-16s until the new stealthy F-35 Joint Strike Fighter is available.
It's not clear whether Abu Dhabi is considering that option.
The United Arab Emirates has a history of buying French military hardware. Apart from the Mirages 2000-9s, in 1994, the seven-emirate federation was the first foreign buyer of the Leclerc main battle tank produced by what was then Giat Industries, now Nexter.
The Emirates bought 390 desert variants of the Leclerc, plus 46 armored recovery vehicles, for $2.4 billion, and remains the tank's only foreign buyer.
The Emirates has built up its air power in recent years to the point where it vies with Saudi Arabia.
It has increasingly focused on offensive operations rather than air-defense, with Iran, its much larger neighbor across the gulf, viewed as its mostly likely adversary.
The Emirates' air component has 155 combat aircraft. Saudi Arabia, with the largest air force in the Gulf Cooperation Council alliance, has 280.