Paul Lewis/BANGKOK
The USA has warned Thailand that it faces a $130 million cancellation charge if it fails to purchase the eight Boeing F/A-18C/Ds it has on order.
The US Government informed the Thai air force of the total cancellation penalty charge at the beginning of March. The collapse of the Thai baht has effectively halved the air force budget.
Speaking exclusively to Flight International, Air Chief Marshal Niamtan Tananit, Commander-In-Chief of the Royal Thai Air Force, made it clear that his preference is to cancel the order, or have the F/A-18s sold on to a third party.
Instead of the F/A-18 purchase, Niamtan wants to upgrade the air force's Lockheed Martin F-16A/Bs and Northrop F-5s.
The deal is costed at $392 million. Niamtan, however, believes that almost as much again would have to be spent to provide the air force with a fully operational squadron of F/A-18C/Ds.
The Thai government has held discussions with William Cohen, the US Defence Secretary, over the problems. Naimtan says: "We asked them to check on the details - what we would have to pay if we cancelled. They finally told us we would be left to pay $130 million."
Chuan Leekpai, the Thai Prime Minister, visits Washington on 13 March to meet US President Bill Clinton. Top of the agenda will be finding a resolution to the issue.
There is growing speculation that the USA, as a goodwill gesture to cash-strapped Thailand, will offer to take the aircraft.
Source: Flight International
