The weapons systems, built by Krauss-Maffei Wegmann and Rheinmetall, will replace Qatar's aging French tanks and South African artillery.
The German deal emerged as the United States announced a $10 billion plans to provide Israel and two gulf states, Saudi Arabia and the United Arab Emirates, with advanced aircraft, missiles, radars and aerial tankers.
The Qatar deal comes amid German negotiations to sell 270 Leopards and armored personnel carriers to Saudi Arabia, warships and armored cars to Algeria and submarines to Egypt.
The United Arab Emirates, a military heavyweight in the Persian Gulf, has bought German weapons systems worth $1.57 billion in the last three years.
Rheinmetall hasn't only sold the Emirates 27mm light naval gun systems but has helped build the country's first munitions factory under its drive to develop an indigenous arms industry.
Germany's Suddeutsche Zeitung newspaper, published in Munich, reported in February that German defense companies sold weapons worth $1.88 billion in the gulf in 2012.
In March, the Stockholm International Peace Research Institute, which monitors global arms sales, placed Germany as the world's No. 3 arms exporter after the United States and Russia.
The Qatar deal involves 62 Leopard 2A7+ tanks with 120mm smooth bore main guns and 24 PzH 2000 self-propelled howitzers.
The 63-ton Leopard is built by Munich-based Krauss-Maffei Wegmann GmBH. Rheinmetall of Dusseldorf provides the gun. They jointly produce the PzH 2000.
The arms exports mark a major shift in Germany foreign policy over the last few years by the coalition government of Chancellor Angel Merkel, made up of her center-right Christian Democratic Union and the pro-business Free Democratic Party.
In large part this was driven by the fall in defense sales in Europe and Asia because of sweeping cuts in military budgets because of a global economic downturn.
The U.S. and European defense industries all have the same problem.
But for the Germans, there was also the difficulty of shedding the country's Nazi past and their strict observance of not selling arms to conflict regions, such as the Middle East -- except, of course, to Israel.
Merkel, who began easing the restriction of arms exports a few years ago, insists she's "committed the values" of democracy and human rights.
But she's come under growing criticism for selling weapons systems to authoritarian states such as Saudi Arabia and the other absolute monarchies in the Persian Gulf, Algeria and further afield to Angola and Indonesia.
"I'm convinced that it is in our interests to enable partners to effectively participate in upholding or re-establishing security and peace in their regions," she declared at a European defense conference in September.
The German newsmagazine Der Spiegel observed: "From the standpoint of the chancellery, two problems can be solved with this doctrine.
"On the one hand, it justifies arms exports to regions like the Arabian Peninsula, which have long been controversial.
"On the other hand, it provides the government with a better justification for Germany's reluctance to get involved in conflicts overseas."
"Merkel no longer wants to be responsible for major overseas military missions. She sees Afghanistan as proof that interventions in foreign countries usually fail.
"In the chancellor's opinion, it's better and less dangerous to provide military support to one side in a given conflict," the magazine said.
Algeria, the military heavyweight of North Africa with which Berlin is increasingly engaged in arms negotiations, is a case in point.
The North African state borders two states torn by conflict, Mali and Libya -- three, if Egypt's growing crisis is taken into account -- with Algeria expected to serve as a bulwark against Islamist militancy and terrorism.
Now, a Rheinmetall subsidiary is planning to establish a factory in Algeria to assemble up to 1,200 of the company's Fuchs APCs over the next decade for Algerian forces.
Since early 2011, Berlin has approved delivery of 55 Fuchs APCs worth $248 million to Algeria, plus other military vehicles worth $374.2 million.
Der Spiegel says Merkel's government has also underwritten a $2.13 billion contract for two navy frigates to be built for Algeria by the ThyssenKrupp Marine Systems of Kiel.
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