Canadian Bombardier Freezes USD 3.4B Plane Contract with Russia
Canadian aerospace and rail equipment giant Bombardier plans to build planes in Russia and the sale of USD 3.4B of aircraft will be delayed over events in Crimea.
Canada has joined the US in imposing sanctions against the country after it moved to annex Crimea, Chief Executive Officer Pierre Beaudoin said.
Bombardier signed a letter of intent in August to sell Russia's state-owned Rostekhnologii as many as 100 Q400 turboprop aircraft valued at about USD 3.4B. The Montreal-based company was expected to sign a deal to establish a turboprop assembly line in Russia in 2014.
Like the US and other allies, Canada has imposed financial sanctions and travel bans on Russian officials. Prime Minister Stephen Harper's government has also recalled its ambassador to Russia, suspended military cooperation and pledged USD 220M in financial aid to Ukraine.
Meanwhile, Russian Deputy Prime Minister Dmitry Rogozin expressed his satisfaction with the suspension of Canadian company plans.
"I was not against Bombardier, but we must produce our own aircraft," Rogozin wrote on Facebook, Friday, Interfax reports.
- » ECB Keeps Cash Aid to Greek Banks Flat Despite Liquidity Shortage
- » PM Tsipras Appoints Euclid Tsakalotos as Greece’s New Finance Minister
- » Greek Banks to Reopen on Thursday - FAZ
- » Tsakalotos Set to Take over as Greece’s Finance Minister
- » Putin Discusses Greek Referendum Outcome with Tsipras
- » German EconMin Warns Greeks 'Need Help'
At first sight, it looks like Bombardier is doing something for which EU-politicians lack the spine. But I wouldn't be surprised if they already had developed doubts about investing in Putania, and see this as a graceful way out. Maybe they have learned from the experience of Shell, BP and others who found to their peril that you can't rely on contacts with Russian firms, especially if government is a stakeholder, an that the judiciary are on the end of a telephone line....