SANCTIONAL ILLUSION

 

Again, Russia is threatened with the possible refusal to supply its fleet with "Mistral", helicopter carriers which are being built for Russia in France. On Monday, Prime Minister of Great Britain David Cameron said that "in the shoes" of the French he would refuse from the execution of the contract. "For the UK, this would have been unthinkable of after the crash of the Malaysian plane in the Ukraine", – BBC quoted Cameron In the end of the last week. German Chancellor Angela Merkel made a similar appeal to France, saying that it is necessary to stop the export of helicopter carriers to Russia, although the current sanctions regime permits this.

Now, the first airborne helicopter landing ship-dock (AHLSD) of the "Mistral" type under the name of "Vladivostok" has already started trial running. 400 Russian sailors (the crews of two helicopter carriers) have arrived at the STX shipyard in Saint-Nazaire where it is built, for training in management of these ships. While the stern of the second AHLSD "Sevastopol" (already manufactured in Russia and towed to France) have already been included in the process of its installation. The Main Staff of the Russian Navy has confirmed that the preparation of infrastructure of hosting of both helicopter carriers is conducted in compliance with the established schedule.

That is why the firm position of the President of France Francois Hollande to deliver the first of the two "Mistral" helicopter carriers to Russia is not surprising. "To date, the level of sanctions does not preclude the supply", – he said to journalists on Monday. However, Hollande made some vague remark on the other ship, saying that the other part of the contract (signed in June 2011) will depend on the Russian approach to the situation in the Ukraine.

The reason for Hollande’s intransigence to his European colleagues was explained by the Russian Vice-Premier Dmitry Rogozin: "Suspension of the contract will be 100 times less painful for the Russian Federation than for France, as we have all grounds to claim back not only the money, but also the aft already manufactured in Russia by "Baltzavod", which means that the French will have to dissemble it. While the penalty itself, according to estimates by Western experts, will exceed $ 1 billion. Some Russian military officials find it rather funny They claim that the breach of the contract by the French would be even economically beneficial for our country, because, as Rogozin says: "Now, Russia has at its disposal the technology of large-scale assembling of such ships, so from now on we can build such ships ourselves, if we need them". Indeed, the availability of the design documentation on the domestic shipyard will allow Russia to build AHLSDs at significantly lower costs.

However, the economy here is pale into insignificance. The first position is taken by the politics. "All these sanctions are the anti-European technological line of the USA: they hit Russia, while in reality they cause an enormous damage to the relations inside Europe and to European industries", – says Dmitry Rogozin. According to him, the French, the Germans and the Italians are interested in cooperation with Russia. While the cooperation with Russia is the most critically important for the Ukraine.

Source: Nezavisimaya Gazeta, July 23, 2014, p. 2

 

MISTRAL OF CONTENTION
Sergei Manukov

RECEPTION OF THE SECOND HELICOPTER-CARRIER OF MISTRAL CLASS BY RUSSIA WILL DEPEND ON ITS BEHAVIOR IN UKRAINIAN CRISIS

President of France Francoise Hollande has announced that reception of the second helicopter-carrier of Mistral class by Russia will depend on its behavior in the Ukrainian crisis. The French leader released this statement immediately after the speech of Vladimir Putin who once again stated that hasty conclusions should not be drawn from the crisis regarding the Malaysian airliner downed in the sky of Ukraine and advocated sitting down at the table of negotiations as soon as possible.

The first ship, Vladivostok, is almost ready and will be handed over to Russian sailors in October of 2014 like it is written in the contract. Problems may appear with the second ship, Sevastopol, that should be ready next year.

Hollande told representatives of the press, "At present, the level of sanctions against Russia is not as high. Does this mean that the second helicopter-carrier will also be supplied to Russia like it is outlined by the contract? This will depend on position of Russia."

France is under the strongest pressure of the allies and especially the US and its devoted "junior brother" UK that demand termination of the contract. Previously, British Prime Minister David Cameron demanded Paris not to supply Mistrals to Moscow. The Prime Minister of the UK announced, "Honestly speaking, it would be unthinkable to fulfill such contract in the UK after the downed airplane in the east of Ukraine." He was supported by a top-ranking official of the Administration of Barack Obama who also announced unacceptability of fulfillment of the contract signed in the years of relatively good relations between Moscow and the West. Back in June, before the tragedy in the Ukrainian sky, the American President expressed concern about this contract because Russia according to him supported Ukrainian separatists.

Incidentally, French Foreign Minister Laurent Fabius spoke about this important issue worth 1.2 billion euros for France last month. He confirmed then that the deal would be fulfilled. It seemed that Fabius did not change his opinion despite the pressure of Kerry and the downed airplane. This was proved by the heated dispute that happened at a meeting of the council of foreign ministers of member states of the European Union between Fabius and his British colleague Philipp Hammond with regard to the same Mistrals.

German leader called on the French not to supply Mistrals to Russia too. Angela Merkel emphasized that the level of sanctions of the European Union against Russia that existed now really allowed Paris to fulfill the terms of the deal.

As to Moscow, it seems that no special panic is seen about the contract there. At least, Deputy Prime Minister Dmitry Rogozin doubts very much that Pars will terminate the deal because negative consequences for it will be much stronger than those for Moscow.

Meanwhile, to soften the economic consequences of termination of the contract a group of American congressmen even opposed Paris to sell or to lease the ships to NATO at the end of May.

Negotiations on construction of helicopter-carriers of Mistral type between Russia and France lasted for two years. The final signing of the deal was announced in summer of 2011. According to the contract, the French should build two ships at their shipyards and two ships in Russia.

Source: Novye Izvestia, July 23, 2014, p. 2

 

IN CASE OF RUINING OF THE CONTRACT ON MISTRAL SHIPS FRANCE WILL HAVE TO PAY ABOUT 3 BILLON EUROS TO RUSSIA

In case of ruining of the contract on universal landing ships of Mistral type France will have to pay about 3 billion euros to Russia in total. Representative of the Russian military industrial complex close to the program for construction of two universal landing ships for the Russian Navy in France reported this.

The source said, "Contract with shipbuilding company DCNS on construction of two universal landing ships of Mistral type worth 1.12 billion euros (about $1.52 billion) in France in the interests of the Russian Defense Ministry was signed on June 10 of 2011."

The specialist emphasized, "The contract contains a clause that deals with possible direct compensation in case the French company ruins fulfillment of the signed agreement. In this case direct compensation to the Russian party on the part of DCNS alone will amount to 1.050 billion euros."

He added, "Moreover, the Russian party has a right to demand through the court imposing of additional penalties on DCNS and compensation for its expenses on materials and other costs related to construction and transportation of two stern parts for universal landing ships Vladivostok and Sevastopol to France. Taking into account these penalties and compensation for expenses, in case of a positive court verdict the Russian party may receive 1.8 billion euros more."

Source: ARMS-TASS, July 22, 2014

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