Germany has made a preliminary decision to buy Israel’s Arrow 3 air-defense system instead of a rival product manufactured by Lockheed Martin Corp., according to people familiar with the matter.
Chancellor Olaf Scholz discussed the air-defense issue earlier Monday with Israeli Prime Minister Yair Lapid in Berlin and they both gave positive signals about a possible deal at a joint news conference. The Arrow 3 interceptor, manufactured by Israel Aerospace Industries, could cost around $2.5 billion, according to reports in German media, if the government chooses it over Lockheed’s THAAD system.
Following Russia’s invasion of Ukraine in February, Scholz’s ruling coalition created a dedicated fund worth 100 billion euros to help modernize its armed forces, which critics have said have been severely underfunded in recent years. The investment is in addition to the federal government’s regular annual defense budget of around 50 billion euros.
Scholz referred to the new fund on Monday, which he said was “for investment in our security and that of our neighbors.”
“And we are very keen to work with Israel on that, including in the area of air defense where Israel has a very effective product with the Arrow 3 system,” Scholz said. Lapid told reporters that Israel “for its part, will play a role in building Germany’s new defense force, mainly in the field of air defense.”
Israel’s ministry of defense did not immediately respond to a request for comment.
Options in play for Germany’s new missile shield included both Arrow 3 and Lockheed’s THAAD, according to defense lawmakers from the ruling coalition.
Arrow 3 is designed to intercept and destroy the newest, longer-range threats, especially those carrying weapons of mass destruction, according to IAI.
In a speech on the future of Europe last month, Scholz said Germany would be investing significantly in its air defense over the coming years as the continent had “a lot of catching up to do.”
ביקורך בברלין, @yairlapid היקר, מעמיק את מערכת היחסים הקרובה והידידותית בינינו. אני אסיר תודה על כך! היא אינה מובנת מאליה. אני נרגש מאוד מכך ששנינו נשוחח היום עם ניצולי שואה בבית ועידת ואנזה. pic.twitter.com/qCsx7XZmDA— Bundeskanzler Olaf Scholz (@Bundeskanzler)September 12, 2022
“All of those capabilities will be deployable within the framework of NATO,” Scholz said. “At the same time, Germany will, from the very start, design that future air defense in such a way that our European neighbors can be involved if desired,” he said, listing allies including Poland, the three Baltic states, the Netherlands, the Czech Republic, Slovakia and the Nordic countries.
Scholz argues that a jointly developed European air defense system would not only be more efficient and cost-effective than if each of country built its individual systems, but it would also be a security gain for Europe as a whole and a showpiece of what Europe was willing to achieve when talking about boosting its contribution to NATO.
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