Sarkozy to strengthen ties with UAE

The French president will open a naval base and lay the foundation stone for the Dh1 billion Abu Dhabi Louvre Museum.

French President Nicolas Sarkozy speaks at a press conference in Strasbourg, France, Saturday April 4, 2009, at the end of a summit celebrating the 60th anniversary of the founding of the North Atlantic Treaty Organization. (AP Photo/Michael Sohn)
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Nicolas Sarkozy, the French president, will open a naval base, lay the foundation stone for the Dh1 billion ($US272 million) Abu Dhabi Louvre Museum and discuss progress on the sale of up to ?8bn (Dh41.11bn) worth of fighter jets during a visit to the UAE this week. The ties between the two countries are being strengthened as several French companies campaign for multibillion-dirham contracts in the Emirates. Areva, GDF Suez and Total are bidding to supply the UAE with the technology for its first atomic energy programme. Dassault is proposing to sell the UAE its latest multi-role jet fighter, the Rafale. The deal could involve 60 Rafale jets worth between ?6bn and ?8bn. When the naval base is opened, France will join the US and Italy in having military bases in the UAE. The US occupies part of the Al Dhafra Air Base outside Abu Dhabi, and Italy has 100 servicemen at Bateen Air Base on Abu Dhabi Island to co-ordinate relief flights to troops in Afghanistan. Stronger relations with France will help the UAE diversify its source of military support and supplies and make it less dependent on one country, such as the US, for technology, said Dr Theodore Karasik, the director of research and development at the Institute for Near East and Gulf Military Analysis (INEGMA) in Dubai. "The UAE has been very clever in using one country against the other to get the best possible deal in the defence and industrial realm," Dr Karasik said. The close relationship between France and the UAE started with the Emirates' first major defence contract in 1998, when the Armed Forces bought 63 Mirage 2000-9 combat planes from Dassault that are expected to be phased out from 2013. In 2007, a partnership of two other firms based in France, the aerospace giant EADS and Thales, won a $1.66bn dual satellite communications system awarded by Yahsat, a subsidiary of Mubadala Development, an investment arm of the Government. The UAE has also bought about $1bn of Exocet missiles from MBDA of France, according to the Baynuna Group, which is based in Abu Dhabi, and in February set up a joint venture with MBDA on establishing a local missile maintenance centre. As well as military and cultural links, a French diplomatic source said that other business agreements would be announced during the visit. "There will be an important project involving the creation of a fund to invest in France," the diplomat said, confirming it would probably involve the new French sovereign wealth fund and Mubadala. "The fund was launched early this year by president Sarkozy to support sovereign wealth funds in their investment strategies in France," the diplomat said. "This can happen through takeover of businesses or stakes in French businesses that can develop specific technologies. With Mubadala this necessarily would mean a return on investments for the UAE. We are talking about important Emirati investments in the technology and health." UThe industrial and property group MAG, based in the UAE, is reportedly in "initial" talks with the German car parts maker Continental to buy its factory in France. Last March, the Government-run Abu Dhabi National Oil Company (ADNOC) renewed its onshore gas concession with Royal Dutch Shell, Total and Partex for 20 years. Last year, total French investments in the UAE amounted to ?2bn, mainly in the banking sector, finance and energy. UAE investments in France, mainly in property and investments in companies, totalled ?1.1bn. The UAE is France's largest customer in the Middle East, with exports, excluding military equipment, reaching ?3.5bnlast year. France imports about ?1bn worth of oil and oil-related products from the UAE each year.