It might not be as fateful as the potential bombing of Iran’s nuclear facilities, but the competition over the Israel Air Force’s future trainer aircraft is a saga of significant political and economic consequences.

The Defense Ministry had planned on issuing a request for proposal for a new training aircraft to replace the IAF’s aging fleet of Skyhawks – which are used in training before pilots fly F16s – earlier this summer but due to uncertainty regarding the defense budget the plans have been postponed.

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Defense officials now believe the proposal will be issued by the end of the year, meaning a decision will be made sometime in the beginning of 2012.

The competition is between Korea Aerospace Industries’ T-50 and and Italy’s Alenia Aermacchi M-346 Master.

Earlier this week, South Korea’s Ambassador to Israel Isloo Kim met with Defense Ministry Director- General Udi Shani to discuss the deal. On Thursday, Kim denied a report in Haaretz that claimed he had threatened Shani that Seoul would cancel its defense ties with Israel if it lost the competition.

“It was a cordial meeting and no threats were made and the story distorted what happened,” Kim told The Jerusalem Post on Thursday.

“This is a commercial deal and the companies involved are negotiating. It will not affect the relations between our countries.”

The Post has also learned the Italian government is in talks with the Defense Ministry about the possibility the deal will be done by barter and Italy will receive two AWACS aircraft from Israel Aerospace Industries.

The IAF is seeking between 25 and 35 jets in a deal that is expected to reach $1 billion.

Prime Minister Binyamin Netanyahu is close friends with Italian Prime Minister Silvio Berlusconi who is lobbying for Israel to choose the M-346. Diplomatic officials are concerned that if Israel rejects the Italian plane it could sour ties between Jerusalem and Rome, one of Israel’s closest friends in Europe.


On the other hand, Israel stands to lose economically if it rejects the South Korean plane and Israeli defense companies are pushing for the T-50. One official estimated that sales to South Korea could reach about $500 million a year.

Over the past year, Israeli defense industries have increased their activities in Seoul and talks are ongoing about the establishment of a number of joint ventures with Korean companies.

In December, for example, the South Korean military issued an urgent operational requirement to Rafael for guided anti-tank missile systems called Spike NLOS after the North Korean artillery attack on Yeonpyeong Island in November.

The South Korean military is also in talks with the Defense Ministry about the Iron Dome, the short-range rocket defense system.

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