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Political Economy

Sweden accepts price cut in order to keep the Gripen with Czech Republic.

Monday, 03 December 2012
Sweden has agreed to lower its lease price with the Czech Republic so that the Swedish gripen fighter jets which the country is currently using on lease to see an extension of the contract.

According to reports from Sweden and Czech Republic, the lowering of the price offer, is aimed to extend the lease of Gripen due to fears that the country would find another fighter jet from another market.

Czech Republic's contract expires in 2014. The country is reported now be under pressure to find either a cheap replacement for the 14 Gripen aircraft which they are renting from Sweden, or a cheap extension when the military budget shrinks.

"The current offer is much more beneficial than the original, "said Defence Minister Alexandr Vondra according to the Czech newspaper, Lidove Noviny, Swedish media outlets report.
"The price was reduced by about Skr 1billion."

The new price extending the lease agreement for 10 years stands at Skr14 billion, and comes after Sweden's first offer stood at Skr15 billion.

Czech Prime Minister Petr Necas is said to have put pressure on Sweden in July by threatening to bring in bids from other suppliers if Sweden could not improve its offer by November.

The first agreement was for 10 years and it began in 2004 and had a value of Skr19.6 billion.
by Scancomark.com Team

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