Malaysian ban on British firms hits Russian MiGs

Malaysian ban on British firms hits Russian MiGs

KUALA LUMPUR (Reuter): Malaysia's ban on buying British
products or services has found an unlikely victim -- the
Russians, who are selling 18 MiG-29 fighter-jets to the
government, industry sources said yesterday.

Russia needs to replace some power equipment on the fighters
with British-made parts to meet Malaysian specifications, but
cannot because of Malaysia's ban on government contracts with
British firms, the sources said.

The Russians are now looking to Spanish or Danish
manufacturers to supply the auxiliary power units (APUs) and
other ground equipment for the MiG-29s.

"It is a pity. The British APUs are smaller, efficient and
cheaper than those made by the other countries," one source told
Reuters.

However, he said the search for a replacement for the British
APUs has not affected the on-going negotiations for the 1.6
billion-ringgit (US$597-million) purchase of the MiG-29s, which
it intends to pay for in cash and palm oil.

Angered by British media reports that Anglo-Malaysian arms
deals were tainted with corruption, Malaysia banned new
government contracts with British companies two months ago.

It is, however, taking delivery this year of 28 Hawk fighters
from Britain under a 1988 arms deal worth one billion pounds
($1.5 billion). The deal has been at the heart of an "arms-for-
aid" controversy in Britain that helped sour British-Malaysian
ties.

The British government has said the arms deal was briefly
entangled with negotiations with Malaysia on providing a 238-
million pound ($351-million) soft loan to a hydro-electric dam.

Malaysia is the first Southeast Asian nation to acquire the
MiG-29s. Apart from the MiG-29s and the Hawk fighters, Malaysia
has also bought eight U.S-made F/A-18 fighters.