Israel signs deal to buy three more German submarines

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Israel today reached an agreement to buy three submarines from German shipbuilder ThyssenKrupp. The megadeal will see the first upgraded diesel-electric submarine out of three purchased built and delivered to the Israeli Navy within nine years. The purchase contract was signed at the Defense Ministry headquarters in Tel Aviv by Director Amir Eshel and ThyssenKrupp CEO Rolf Wirtz, in the presence of Israeli Navy Commander David Salama.

Reports indicate that the three submarines would cost more than double their original price, for a total of 3 billion euros ($3.4 billion). The German government will fund 540 million euros in the deal, with a special grant via an agreement signed between the two countries in 2017. Israeli politicians have criticized the price hike, which apparently went unreported before the signing in the government or in the Knesset. Still, experts explained that the price hike reflects the product shift, with Israel now buying much more advanced models.

A parallel industrial strategic cooperation agreement signed between the Israeli Ministry of Economy and Industry and ThyssenKrupp provides for reciprocal purchases by the German company and its subsidiaries and suppliers of Israeli products, mainly security equipment, worth more than 850 million euros, to be purchased over a period of 20 years.

The new submarines will form a new class called Dakar, in honor of the Israeli submarine that mysteriously disappeared in 1968 en route from the UK to Israel with 69 crew members on board. These new ships are essentially an upgraded version of the Dolphin-class diesel-electric model (also purchased from ThyssenKrupp) that the Israeli Navy has been using for some years. The new contract also includes the construction of a training simulator in Israel and the supply of spare parts.

“Israel’s defense system is getting stronger and better equipped. This morning we finalized the purchase of three world-class operational submarines. This purchase adds to a series of steps that I have had the privilege of promoting over the past year, equipping and strengthening the IDF with the purchase of helicopter squadrons, combat aircraft , supply planes and other armaments. We are gearing up for operational readiness for challenges on all terrains,” Defense Minister Benny Gantz tweeted.

Gantz thanked the German government for helping to move the deal forward and for its continued commitment to Israel’s security, adding, “I’m sure the new submarines will improve the navy’s capabilities and help maintaining Israel’s security superiority in the zone.”

Gantz’s series of steps probably refers, among other things, to a December 31 agreement between Israel and the United States to purchase a dozen heavy transport helicopters, two supply planes (additional ), advanced aerial munitions, air defense systems, new naval and land platforms and cyber and digital systems. Israel also plans to purchase additional F-35 fighter jets from the United States in the near future.

After Gantz’s statement, Prime Minister Naftali Bennett says signing the submarine deal means a significant boost to Israel’s national security and will ensure Israel’s continuity and strategic superiority for the coming years. He noted that the government he leads has and continues to operate on all matters of security procurement with the utmost honesty. He thanked former German Chancellor Angela Merkel and newly elected Chancellor Olaf Scholz for their efforts to seal the deal after a long delay.

The new deal comes amid growing calls in Israel for a formal investigation into past purchases of three submarines and missile boats for the protection of Israel’s offshore natural gas platforms. Both agreements are at the heart of a legal process, with former senior Israeli security officials and associates of former Prime Minister Benjamin Netanyahu accused of accepting bribes in order to advance the purchase. Netanyahu himself has not been charged in the case.

Gantz and Foreign Minister Yair Lapid announced plans last week to submit a formal commission of inquiry for government approval. But he was reportedly delayed by government negotiations to sign the new submarine deal. In past agreements, the German government has included a clause allowing it to renege on its commitments in the event of proof of corruption.

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