- The Washington Times - Wednesday, July 24, 2002

Boeing Co. said yesterday that it has signed agreements with three European companies to develop missile-defense systems that would protect the United States and its allies.

The partnerships with European Aeronautic Defense and Space Co., Finmeccanica SpA and BAE Systems, all partners of Strand, Britain-based MBDA, are the first of their kind for Seattle-based Boeing, one of the nation's leading developers of missile-defense technology.

"U.S. and European industry came together today to show unity of purpose and appreciation of a common global threat," Boeing Chairman and Chief Executive Officer Phil Condit said. "We will work together on ballistic missile defense adding a new dimension to transatlantic cooperation."

The agreement yesterday underscores recent urgings from the federal government for defense contractors to Establish more partner-ships with European rivals. Observers said that America's withdrawal last year from the Anti-Ballistic Missile Treaty opened the door to allow more research and development of missile technologies. Under the treaty, only limited cooperation and testing on short-range missile programs was permitted.

U.S. officials have said that the participation of allies in creating a missile-defense system could extend its range, defray some costs and allow the United States to test and deploy sensors, radar or missile interceptors closer to enemy countries.

"Essentially, the U.S. government has told companies they want more European partnerships," said Theresa Hitchens, vice president for the Center for Defense Information, a nonpartisan military-research group in Washington that opposes missile-defense projects. "This is not surprising. They've been over there flogging the idea of industrial cooperation."

Miss Hitchens and other analysts said the involvement of European companies in creating missile-defense systems does not necessarily mean governments there will help fund such projects. Skeptics have long outweighed proponents there, they said, and most European nations are more concerned with pressing military matters, such as upgrading obsolete communications equipment and organizing peacekeeping troops.

"For the last two decades, European nations haven't been interested in anything to do with missile defense," said John Pike, director of Globalsecurity.org and an outspoken critic of missile-defense systems. "It's not even on their list."

But, Miss Hitchens said, European governments won't necessarily have a problem with their companies creating partnerships with U.S. firms.

"The idea is that if my company can sell to the U.S. government, more power to you," she said. "But if you expect their government to spend money on it, forget it."

Lockheed Martin of Bethesda, another large U.S. firm working on missile defense, is reported to be talking to several European countries, including Russia, about establishing similar partnerships.

Boeing has fought to regain its financial footing after taking a post-September 11 hit because of its heavy involvement in the commercial-airline industry.

The company said last week that earnings for the second quarter fell to $751 million (92 cents per share) from $804 million (95 cents) last year.

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