Malaysia, Indonesia to swap cars, planes

Malaysia, Indonesia to swap cars, planes

KUALA LUMPUR (AFP): Malaysia will pay for six Indonesian CN- 235 aircraft with 2,500 Proton cars and 20 MD3 trainer planes in a swap-deal to be sealed next week, officials said yesterday.

The 260-million-ringgit (US$104 million) counter-trade pact to be signed here next Thursday would allow the entry of Indonesia's medium-range CN-235 military transport aircraft into the Malaysian defense market, they said.

For Malaysia, the package means a successful breakthrough for its national Proton car into the populous Indonesian auto market, a defense ministry spokesman said.

Defense Minister Najib Tun Razak said Thursday that Malaysia would swap the Proton cars and 20 Swiss-designed MD3-160 aerobatics trainer planes produced locally for the CN-235 made by Indonesia's Nusantara aircraft industry (IPTN).

The MD3-160 planes are manufactured by Malaysia's SME Aviation Sdn. Bhd.

"The contract is a win-win situation for both sides as the items exchanged are equal in value," Najib said.

Najib said the CN-235 would eventually replace the aging 30- year-old fleet of De Havilland Caribou now being used by the Malaysian airforce.

A memorandum of understanding for the counter-trade package was signed in Jakarta in May last year.

Proton began delivering to Indonesia an initial batch of 1,000 Proton Iswara models for use as taxis and 1,500 Proton Wiras as government vehicles from September last year.

Airod Sdn. Bhd., a Malaysian aviation repair and maintenance group, is to service and overhaul the Indonesian aircraft as part of the deal, officials said.