KUALA LUMPUR, Nov 28 [2001] (AFP) - 06:36 GMT - Negotiations
on the purchase of French submarines for the Malaysian navy were still in
progress, Defence Minister Najib Razak said Wednesday.
"It will be inappropriate for me to make any further comment. When the time
comes, I will comment," he was quoted as saying by the official Bernama news
agency.
Malaysia was also studying several other offers, Najib added.
He denied that the talks on the purchase of the submarines were tied to the
issue of national carrier Malaysia Airlines System (MAS) being allowed to
increase its flights to France.
Jane's Defence Weekly recently said France was close to signing a contract worth
1.2 billion euros (1.08 billion dollars) to supply Malaysia with three
diesel-electric submarines.
The specialist magazine said the deal had been held up by a demand from MAS to
increase its flights between France and Malaysia from three to seven a week.
"It would appear that Kuala Lumpur considers traffic rights for MAS part of the
offset package in the naval transaction," a source at French warship builder
Direction des Constructions Navales (DCN) told the magazine.
Jane's Defence Weekly said DCN was ready to supply the Royal Malaysian Navy with
two new-generation Scorpene submarines which would be built together with
Spanish shipmaker Izar.
DCN was also to deliver the "Ouessant", a refurbished Agosta-class submarine,
which France recently withdrew from active service. It would serve as a training
vessel for Malaysian submariners and would be based in Toulon in the south of
France.
The contract would represent a breakthrough for France in a Malaysian market
dominated up to now by German and British suppliers, according to Jane's.