US-Sanctioned China Firm Wins $4bn Tender for Turkey Missile Defence System

Turkey has awarded a contract for a long-range air and missile defence system to a Chinese firm that is sanctioned under the US after rejecting bids from rival firms in the US, Russia and Europe.

The contract worth $4bn (£2.5bn, €3bn) was awarded to China Precision Machinery Import and Export Corp (CPMIEC), according to the Turkish defence minister.

In the tender, state-owned CPMIEC's FD-2000 system defeated the Patriot system developed by US firms Raytheon and Lockheed Martin, the S-400 system of Russia's Rosoboronexport and the Samp-T developed by Italian-French consortium Eurosamrs.

China's Rising Defence Sales

China replaced the UK as the fifth largest arms supplier during the 2008-2012 period, according to research by the Stockholm International Peace Research Institute (Sipri).

The volume of Chinese exports of major conventional weapons rose by 162% between 2003-2007 and 2008-12, and China's share of the volume of international arms exports increased from 2 to 5%, Sipri said. Pakistan accounted for 55% of Chinese arms exports during the period.

China-made arms are now comparable to those made in Russia, the US and Europe, according to experts. The country has revealed several new locally-made weapon systems after decades of high military spending and promotion of local contractors. It has also significantly decreased dependence on arms imports.

CPMIEC was established by the former China Ministry of Space and Industry in 1980 for marketing arms produced under the state jurisdiction. It currently markets missiles produced by state-owned firms, the China Aerospace Science and Technology Corp. and the China Aerospace Science and Industry Corp.

Because of CPMIEC's sales of missile technology to Iran and Pakistan, the US sanctioned the firm and its subsidiaries multiple times and barred all US persons and entities from engaging in business with it.

In 2003, Washington extended sanctions on the firm for selling arms to Iran. In February, the US announced sanctions on the company for violating the Iran, North Korea and Syria Nonproliferation Act.

Meanwhile, Turkey that has the second-largest deployable military force in the NATO alliance is looking to build its own air and missile defence systems. Since 2012, the country has been relying on the US built Patriot air and missile defence system deployed by NATO.