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Qatar, France sign billion-dollar fighter jet deal amid Gulf crisis

David HARDING
 

Qatar agreed Thursday to buy 12 French-built fighter jets, part of a multi-billion-dollar raft of deals announced as President Emmanuel Macron visited the emirate, hit by the Gulf's worst political crisis in years.

The 1.1-billion-euro ($1.3 billion) order for Dassault Aviation (LSE: 0IAX.L - news) warplanes, with an option for 36 more, comes as Qatar faces a trade and diplomatic boycott by Saudi Arabia and its allies.

The deal was one of a slew of contracts together worth more than 11 billion euros ($13 billion) announced between Qatar and France on Thursday.

Qatar Airways announced a 5.5-billion-euro ($6.4-billion) deal to buy 50 Airbus A321 passenger planes, with an option for 36 more.

The two countries also signed a three-billion-euro ($3.5 billion) deal on the operation and maintenance of the Doha Metro, currently being built as the country prepares for the football World Cup in 2022.

The lucrative contracts were inked in the presence of the two young leaders -- Macron is 39 and Qatar's Emir Sheikh Tamim bin Hamad Al-Thani is 37.

Qatar also signed a letter of intent to buy 490 VBCI armoured vehicles from Nexter, a French government-owned weapons manufacturer, in a potential deal worth 1.5 billion euros ($1.7 billion), the Elysee said.

- Regional tensions -

The military contracts come at a time of heightened tensions in the Gulf, where a Saudi-led boycott of Qatar is in its sixth month.

Since June 5, Saudi Arabia, the United Arab Emirates, Bahrain and Egypt have diplomatically isolated Qatar, accusing the emirate of supporting Islamist extremists and of being too close to Shiite Iran, Riyadh's arch-rival.

The four countries also cut off all air and sea links to Qatar and closed the only land terminal for the tiny peninsula.

Qatar denies the allegations and has accused the Saudi-led bloc of aiming to incite regime change in Doha.

Speaking about the crisis at a later joint press conference with Macron, Sheikh Tamim reiterated Qatar's calls for a negotiated settlement.

"Qatar's sovereignty is above all considerations. We want to resolve the rift but not at the expense of our sovereignty and dignity," he said.

"If the brothers want to resolve the dispute, we are ready," he said. "Any solution should be founded on a clear basis acceptable by all and the non-interference in the sovereignty of others."

The French president, who had flown to Doha from Algeria, urged a diplomatic solution through regional mediator Kuwait.

"I reiterated to the emir France's support for Kuwait's mediation efforts and my wish for a quick solution," Macron told reporters.

The prospects, however remain increasingly remote.

A Gulf Cooperation Council summit in Kuwait this week ended a day early after the leaders of Saudi Arabia, the UAE and Bahrain failed to attend.

Macron also urged all countries, including France, to give "a very clear commitment" to do more on terror financing.

He added that Iraq would announce its total "liberation" from the grip of the Islamic State jihadist group by the end of December.

Thursday's defence deals are the latest in a growing list signed by Qatar since the Gulf diplomatic crisis erupted. It has also struck deals with the US, Italy and Britain.

A 2015 deal between Qatar and France for 24 Rafale fighter jets was worth 6.3 billion euros ($7.4 billion).

Qatar Airways Group chief executive Akbar al-Baker said in a statement that the Airbus deal would "answer our need for growth and additional capacity".