Russian Tactical Missiles Corporation lost US$790 million due to Libya conflict

01 February 2012 defenseWeb

Russian missile manufacturer TRV lost US$791.22 million worth of business with Libya due to the civil war, company General Director Boris Obnosov has said.

“In total, export contracts that were not fulfilled totalled 600 million euros,” Obnosov said. “Also, it is impossible not to note the fact that a contract was signed with Libya for our Bal-E coastal defence missile system. Unfortunately it was not fulfilled.”

“These lost opportunities – that which we call lost profit – are pretty serious for the corporation and not just in the financial sense,” RIA Novosti reports him as saying. “In addition, there were several contracts still in the final stages of discussion.”

“We delivered about US$390 million worth of missiles in 2011, up 14 percent on the previous year,” he said, and added that TRV hopes to export US$527.5 million worth of missiles this year.

Tactical Missiles Corporation JSC (TRV) is one of the largest developers and manufacturers of various missiles as well as shipborne and coastal missile systems. It integrates 19 Russian defence enterprises, including the former Vympel, Zvezda-Strela and Raduga design and manufacturing organisations. It offers for export the Kh-31 (AS-17) family of guided tactical missiles, several modifications of the Kh-25M modular missile and the “Uran-E” and “Bal-E” missile systems, amongst others.

In September last year Libya’s new authorities said they would not honour previous arms deals with Russia and were not planning to buy Russian weaponry.

Russia banned weapons sales to Libya in March last year, suspending its arms contracts with the Gaddafi government in line with moves by other nations.

Russia's arms exporting organisation Rosoboronexport said that it lost some US$4 billion in existing and potential arms deals with Gaddafi's government. In addition, Russia had also been near to closing deals to sell military aircraft and anti-aircraft missiles worth another US$1.8 billion.

Then Libyan Defence Minister Yunis Jaber in January 2010 year went on a major spending spree during a visit to Moscow, signing 1.3 billion euros worth of deals, including for six Yak-130 fighter-trainers. Libya had also been expected to become the first foreign buyer of Russia's Sukhoi Su-35 fighter and a contract worth US$800 million for 12-15 aircraft had been ready for signing.

A range of other contracts for helicopters and missile systems were also being discussed. Libya had also shown great interest in Russia's new S-400 missile defence system, its T-90S tanks, submarines and rocket launchers.

The Soviet Union had delivered a huge amount of military hardware to Libya before the collapse of the USSR, including 350 fighter jets between 1981 and 1985 as well as 4,000 military vehicles and tanks.

Many other countries delivering weapons to Gaddafi’s regime have also had business disrupted, including Malta, Italy, Germany and South Africa.