Friday, 7 June 2019

Greece Sends LOI to France for Belharra Frigates, Looking for Financing

Naval Group video

Greece Sends LOI to France for Belharra Frigates, Looking for Financing - Naval News

A Letter of Intent (LOI) was reportedly sent yesterday by the Greek defense procurement agency to the French government, in connection with the procurement of two Belharra frigates from Naval Group for the Hellenic Navy.

Belharra frigate in AAW configuration (with 32x VLS) seen here launching two ASTER surface to air missiles. Screen capture from Naval Group video.

This information was first published by Greek defense magazine Doureios Ippos (the Trojan Horse).

Contacted by Naval News, a Naval Group spokesperson declined to comment on the information.

It has been a known fact since about 2008, that the Hellenic Navy is looking to procure new surface combatant, primarily for Anti Air Warfare (AAW) missions.

Greece has been facing head winds with this plan ever since, due to the financial constraints. While France was hopping Greece could use some of the European bond money for the financing of the frigates, this is no longer possible according to Naval News’ sources in Greece: This money is set to be used to pay back IMF loans in advance (allowing the Hellenic government to save on interest rate).

In order to find a solution to this deadlock , according to Doureios, France asked the Greek government for a kind of “proof in writing” that there is truly an interest to procure Belharra frigates. Hence the LOI from the procurement agency. This LOI will now serve as a firm interest for the French side to look for financing from financial institutions for the procurement of the two frigates.

Slowly coming out of the economic crisis, Greek government’s defence procurement is more than ever tied to the need for investments, to rejuvenate the industrial capabilities and create new jobs. At the same time the country is in a volatile region and the new era in Greek – US relations comes to address the political, security and economic aspects of that situation. The recent acquisitions of Neorion Shipyards and Elefsis Shipyards by Onex Corporation, is a clear sign of the relations between the two countries. At the same time Hellenic Shipyards (Skaramangas) are still under restructuring. In this environment Naval Group or any other competitor would have to present a proposal that would potentially provide technology transfer and the opportunity to create jobs locally, backed with political support and a solid financial plan. A difficult task indeed.

According to Naval Group, Belharra is the answer from to navies looking for a compact frigate to perform a large range of missions, stand-alone or within a task force, for high sea duration missions or for shallow water operation in congested and contested operational environment. This new frigate features high level capabilities in anti-air, anti-surface, anti-submarine, and asymmetric warfare domains as well as the access to deep strike capability.

In April 2017, the French Defence Ministry awarded a contract to Naval Group for the construction of five Belharra frigates for the French Navy. Known as FDI (for Defense and Intervention Frigate) the first of class surface combatant is to be delivered in 2023 while first steel cutting will take place at the end of the year at Naval Group’s shipyard in Lorient.

Hellenic Navy Briefed on Naval Group's Belharra Frigate
Greece to negotiate FREMM Frigate or Gowind corvette acquisition with France

FTI / Belharra Frigates: Details

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