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Tuesday, 18 December, 2001, 15:56 GMT
China warns Israel over Awacs
The Phalcon system was to be fitted on Ilyushin-76 aircraft
China has warned Israel that its decision to cancel the sale of an advanced airborne radar system could hurt bilateral relations, unless a "satisfactory solution" is found.

Israel bowed to American pressure in July last year and scrapped a $250m deal to sell China a Phalcon Airborne Warning and Control System (Awacs).

We maintain that agreements or memoranda of understanding reached between state and state should be abided by

Chinese spokeswoman Zhang Qiyue
"We hope the countries concerned can take responsibility and put forward solutions that the Chinese side is satisfied with, so as not to undermine relations between China and these certain countries," a Chinese foreign ministry spokeswoman said.

Speaking at a press briefing, Zhang Qiyue said she could not confirm Israeli press reports that said China was demanding $2bn compensation for the cancellation.

Israeli officials also declined to confirm the figure.

Military balance

"We maintain that agreements or memoranda of understanding reached between state and state should be abided by," Ms Zhang said.

"This is the basic norm in state-to-state relations."

Israel said it has opened discussions with the Chinese Government to end the dispute.

The United States put pressure on Israel to cancel the deal for fear that Beijing's purchase of the technology would upset the military balance between China and Taiwan.

The Israeli Government gave in after the US Congress threatened to cut the $2.8bn it gives Israel annually if the deal went ahead.

See also:

13 Jul 00 | Middle East
China's weapons chase
12 Jul 00 | Middle East
Israel scraps China radar deal
03 Apr 00 | Middle East
US anger at Israeli arms sales
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