Julian Moxon/PARIS

French defence-procurement plans face further turmoil after the new Government cut almost another 10% off the 1998 budget and promised a "fundamental review" of defence spending later this year.

The cuts, amounting to 9.7% for 1998, are aimed at several major programmes, with Dassault's Rafale and Aerospatiale's nuclear- missile programmes potentially under threat.

Precise details of the cuts have not been revealed, but it is known that the Government has effectively abandoned its predecessor's commitment to multi-year annual procurement of 48 Rafale fighter-bombers at least until certain conditions are met, notably a stronger commitment to European co-operative programmes and to the planned merger with Aerospatiale.

Only two Rafale aircraft will be bought in 1998, for the Navy to complete the half-squadron that initially will equip the carrier Charles de Gaulle. The carrier has itself suffered a further three-month delay in service entry.

In terms of spending on equipment, the new budget represents a further reduction in the 1998 spending plan, to Fr82 billion ($13.6 billion), against Fr89.7 billion originally budgeted in the 1997-2002 five-year spending plan approved in 1996 by the previous Government.

Major international programmes have been preserved, although the Franco-German Horus observation satellite appears doomed, and a moratorium has been placed on launching new national programmes. Other projects will be stretched, and may yet be abandoned altogether in the autumn review.

The ministry of defence's arms- procurement chief, Jean-Yves Helmer, points to savings of Fr7.4 billion already in the 1997-2002 budget plan in the existing effort to make cuts of between 10% and 30% in current and planned programmes.

The right-wing president of France, Jacques Chirac, warns that if cuts of such magnitude continue, "-the entire coherence of our defence policy will be severely compromised".

Source: Flight International