The Defense Ministry announced on Wednesday that the German Bundestag has approved the expansion of the deal to sell Israel's Arrow 3 system to Germany, valued at approximately $3.1 billion.
The signing of the expanded contract is expected to take place on Thursday in Germany, led by the head of the Homa Directorate at MAFAT in the Defense Ministry, with participation from representatives of the Israeli Defense Ministry, the German Defense Ministry and Israel Aerospace Industries. The Arrow deal, signed by the defense ministries of Israel and Germany, is expected to total over $6.7 billion (more than 20 billion shekels) and will be the largest in the history of the State of Israel.
The Arrow 3 system was developed jointly by the Homa Directorate at MAFAT in the Defense Ministry, the US Missile Defense Agency (MDA), and Israel Aerospace Industries. As part of the deal expansion, the Israeli Defense Ministry and the German Defense Ministry have agreed to a significant increase in the production rate of Arrow 3 interceptors and launchers, to be supplied to Germany, significantly improving its air defense capability.
The scope of the deal is estimated at approximately $3.1 billion and is expected to complete the sales contract that Israel and Germany signed about two years ago, valued at approximately $3.6 billion. The two deals together are estimated at approximately $6.7 billion (over 20 billion shekels), Israel's largest-ever defense export deal.
"Expression of German trust"
Defense Minister Israel Katz said, "The Bundestag's approval of the Arrow 3 deal expansion is a clear expression of the deep trust that Germany places in the State of Israel, in its technological capabilities and in our shared commitment to defending our citizens in the face of escalating threats.
"This is a first-class strategic partnership, based on a long-term security strategy. The revenues from the deal will help continue advanced strategic developments, strengthen the IDF's military capabilities, and ensure Israel's qualitative edge for years to come against our enemies – while deepening security cooperation with our partners in Europe and around the world."
Defense Ministry Director-General Maj. Gen. (Res.) Amir Baram said, "The Arrow deal expansion is another significant milestone in the deepening strategic relations between Israel and Germany, our central partner in Europe. The massive deal, valued at over $3 billion, embodies, in practical terms, the Defense Ministry's strategy to increase defense exports. The deal will strengthen Israel's position in the world as a defense superpower, will expand and accelerate Arrow production for the IDF as well, and will channel billions into strengthening the defense industries and developing the next generations of defense systems."
MAFAT head at the Defense Ministry, Brig. Gen. (Res.) Dr. Danny Gold said, "I congratulate the signing of the deal with Germany to expand procurement of Arrow 3 interceptors. This represents a significant expression of trust in the Defense Ministry, the Israeli defense industry, and relations between the countries. The Arrow system, a significant part of the multi-layered air defense array that protected the citizens of the State of Israel during the war, now protects Germany's skies. We will continue to fulfill our mission as required."
IAI CEO Boaz Levy said, "IAI's centrality in Germany's air defense array and the trust built with the German government were expressed in the delivery of the Arrow 3 system within just two years from the signing date to supply. The mutual trust, advanced technological development capabilities, as proven in the campaign and meeting the schedules – all these led to the German government's decision to approve the follow-on deal for procurement of the Arrow air defense system."
