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May 4, 2001

North Korea says it will keep selling missiles
Israel unveils new air-to-air missile, hopes for foreign sales
Aerospace electronics firms may benefit most from sale of arms package


Agence France Press - May 4, 2001

North Korea says it will keep selling missiles

North Korea's leader Kim Jong-Il vowed his country would continue to sell missiles and technology abroad despite his commitment to a test moratorium, a senior EU official said Friday. South Korea's President Kim Dae-Jung said however that the landmark EU mission to Pyongyang this week would still help to thaw the frozen dialogue between the communist North and the United States.

Kim Jong-Il said the sales of missiles and weapon technology was "part of trade," according to EU foreign and security policy chief, Javier Solana, who was part of the delegation that travelled to the communist country this week. Kim promised to keep a 1999 moratorium on missile tests until at least 2003 during talks Thursday with the EU mission led by Prime Minister Goeran Persson of Sweden. "On the export of technology, the answer was much more negative," Solana told a news conference in Seoul. "If he (Kim Jong-Il) finds people who buy (missile delivery) vehicles or want to buy, he will sell it," Solana said.

Missiles sales, the threat of a North Korean attack on US territory and accusations of state-sponsored terrorism have kept North Korea on the US list of rogue states. The United States says it has evidence of North Korean missiles and technology sales to Iran, Iraq, and Syria. Pakistan and other Gulf states are also thought to have bought weaponry from the North. North Korea triggered international concern when it test-launched a rocket over Japan on August 31, 1998. Pyongyang said it was a satellite launch, but the United States and Japan insisted it was a ballistic missile test. The communist state suspended tests in September 1999 when President Bill Clinton said the United States was ready to lift some economic sanctions. But it has demanded cash compensation for ending exports of its missiles.

US President Geroge W. Bush has used the North's missile threat and proliferation to justify his planned Missile Defense shield. The Swedish prime minister told reporters in Seoul it was crucial for North Korea to keep to its 1994 agreement with the United States freezing its nuclear development as well as complying with the 1999 moratorium. "Yesterday, I made it perfectly clear during talks in Pyongyang that also for the EU, it is a necessary condition that North Korea stick to the 1994 agreed framework and the 1999 agreement on the moratorium on testing," he said. "The message we got yesterday was of course a constructive message. I really hope that message will be carried out in actions from the North Korean side," he said. President Kim said the North's commitment to keep the moratorium on missile tests was a "quite unexpected result." "This was a very good result and will have a positive repercussion on dialogue between North Korea and the United States," Kim told the joint press conference with Persson.

During a summit on Friday, Persson briefed the South Korean leader on the five hours of talks with Kim Jong-Il in Pyongyang on Wednesday and Thursday. Persson is the most senior Western leader to have visited North Korea and met its secretive leader. He reaffirmed at the press conference that the EU did not seek to, and could not replace the United States as the key player in negotiating with North Korea. But he said the EU would take a greater role if asked. The Swedish leader said the other main results from the talks were Kim Jong-Il's expressed commitment to hold a second Korean summit and to start a dialogue on human rights with Europe. However, on the timing of the summit, Kim Jong-Il said he wanted to see the results of a US policy review "before he decides what timing is appropriate," the prime minister said. The two Korean leaders held a historic summit in Pyongyang last June. But contacts have been halted as North Korea has become increasingly angry at the stance of the United States, a close ally of South Korea. President Kim refused to comment on the reported detention in Tokyo of a North Korean believed to be the eldest son of Kim Jong-Il.


Associated Press - May 3, 2001

Israel unveils new air-to-air missile, hopes for foreign sales

Israel unveiled its newest air-to-air missile Thursday, planning to showcase it at an air show and offer it for sale around the world. The Derby, a step up from the popular Israeli-made Python-4, is aimed at the same market courted by the U.S. manufacturers of the AIM-20 missile.

Israel sells the Python-4, a heat-seeking missile, to countries around the world, including China, where it was carried on the Chinese fighter jet that collided with a U.S. Navy surveillance aircraft last month. The Derby will be a centerpiece of the Israeli exhibition at the annual Paris air show next month, where negotiations often involve multimillion-dollar arms export deals. U.S. manufacturers will also be displaying their wares. In the past, weapons sales competition has strained relations between the two countries, which are close strategic allies. According to the Israeli Defense Ministry, the Derby can be launched from U.S.-made F-16s or other relatively small fighter jets in all weather. Its ability to hit targets at short and medium ranges beyond the pilot's vision is an advancement over Israel's Python-4, one of the most advanced short-range air- to-air missiles, the defense ministry said.

In a statement, the Israeli defense ministry said the Derby can be fired from the same tube as the Python-4, reducing conversion costs. The Derby and the AIM120 missiles track aircraft with radar rather than heat. The director of project to develop the Derby, Uzi Ganani, said the new missile is lighter than the American AIM120 and marks a "major advancement" because it has advanced programmable electronic counter countermeasures, which overcome aircraft defenses. "This area is totally new for the Israeli air weapon industry. We never before had radar air missiles," said Yiftah Shapir, coeditor of the Middle East Military Balance, an annual report published by the Jaffee Center for Strategic Studies at Tel Aviv University. Shapir said competition with the U.S. defense industry could strain relations with the United States. "It's a very fierce competition," he said. "The American industry will do everything to twist the arm of Israel and its prospective buyers. The political implications could be overwhelming."

The two countries are locked in such a contest over a $250 million contract to sell its anti-tank missiles to the Netherlands, a contest that could determine who wins deals with the other NATO countries. Finland has already decided on Israel's anti-tank missile, the Spike, increasing the chance that other European countries will follow - a market that Israel's Arms Development Authority estimates to be worth more than $2 billion over the next five years.


Aviation Week - May 3, 2001

Aerospace electronics firms may benefit most from sale of arms package

There have been bigger military sales to Taiwan than the one President Bush announced April 24, such as the $ 6 billion sale of 150 F-16 fighter jets in 1992, but few sales could be as beneficial to the aerospace industry - and particularly electronics makers - as this one could prove to be, an analyst said.

The arms package approved Tuesday includes four KIDD-class destroyers, 12 P-3C Orion anti-submarine aircraft, up to eight electric diesel powered submarines and several MH-53 minesweeping helicopters. "That's a sizeable package," said Joel Johnson, vice-president of international affairs for the Aerospace Industries Association of America. "It's not the biggest we've seen, but it's certainly respectable."

Johnson said much of the weaponry proposed for sale to Taiwan is no longer in production, such as the Lockheed Martin P-3C Orion anti-submarine aircraft. The plane first went into production in 1969 and evolved through numerous modifications. But production has long since ceased, said Hugh Burns, a Lockheed Martin spokesman. Suppliers expected to benefit Though production lines reopened again several years ago to provide a few planes to the South Korean military, the planes were delivered two years ago and the production lines have been closed again. "There are no spares sitting around and no hulls exist," Burns said. As a result, the production lines of prime contractors will have to reopen, and that will invariably benefit small electronics suppliers, since many of the original electronic components have long since been upgraded or in some cases have become completely outmoded. Johnson said the possible sale presents a welcome change for an industry that has had to depend on upgrades of existing weapon systems or developing components for aircraft like the V-22, which haven't yet been mass-produced. "The real cost will be in the electronics, from the sensory systems to the software," he said. "These weapons require a variety of electronic components and a slew of other things, from the kind of radar they will have, to the vertical launch tubes they'll have, to the range of armaments." And in the case of submarines and missiles, aerospace companies already provide a significant portion of the electronic systems. "I imagine most of that money will end up in the industry," Johnson said. "This is the kind of buy that helps the defense industry base across the board."

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