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Russia Mistral: France 'agrees warship compensation' Russia Mistral: Hollande denies striking compensation deal
(about 9 hours later)
France has agreed to pay compensation to Russia for cancelling the sale of two warships, a Russian official says. President Francois Hollande has denied claims that France has agreed to pay compensation to Russia for cancelling the sale of two warships.
France stopped the sale after the outbreak of the conflict in eastern Ukraine, where Russia is accused of backing separatist rebels. Mr Hollande said no agreement had been reached, contradicting an aide to Russian President Vladimir Putin.
The Mistral contract was worth €1.2bn (£843m; $1.3bn). Russia made an advance payment of about €840m. "Discussions are under way. I will make a decision in the coming weeks," Mr Hollande told a news conference.
The first of two helicopter carriers - the Vladivostok - was supposed to be delivered to Russia in November 2014. France stopped the planned sale after the outbreak of the conflict in eastern Ukraine.
"The negotiations are completely finished, everything has already been decided, both the time-frame and the amount," said Vladimir Kozhin, an aide to Russian President Vladimir Putin. The deal, for two Mistral helicopter carriers, was worth €1.2bn (£843m; $1.3bn). Russia made an advance payment of about €840m.
Western sanctions have been ratcheted up against Russia since March 2014, when the Ukrainian conflict erupted, with Russia's annexation of Crimea. The first of two - the Vladivostok - was supposed to be delivered to Russia in November 2014.
"I hope that in the very near future an agreement will be signed on breaking the contract, and then the sum that France will pay us will be announced," Mr Kozhin was quoted as saying. Vladimir Kozhin, a military technology adviser to Mr Putin, said on Friday that negotiations over compensation were "completely finished".
He is an adviser to President Putin for military technology co-operation. "Everything has already been decided, both the time-frame and the amount," Mr Kozhin told Russian state news agency RIA Novosti.
Sources close to the talks, quoted by Russia's Kommersant daily, say France will compensate Russia to the tune of €1.16bn. But Mr Hollande's comments suggest that the agreement is still in question.
Sources close to the talks, quoted by Russia's Kommersant daily, have suggested France will compensate Russia to the tune of €1.16bn.
That sum includes the amount that Russia has already spent on special training for 400 sailors, on port infrastructure in Vladivostok for the two warships and on developing four prototype Ка-52К helicopters.That sum includes the amount that Russia has already spent on special training for 400 sailors, on port infrastructure in Vladivostok for the two warships and on developing four prototype Ка-52К helicopters.
The compensation deal was clinched last week at talks between Russian Deputy Prime Minister Dmitry Rogozin and French Defence Secretary-General Louis Gautier, Kommersant reports. The compensation deal was discussed last week at talks between Russian Deputy Prime Minister Dmitry Rogozin and French Defence Secretary-General Louis Gautier, Kommersant reports.
The Mistral contract dates back to a June 2011 agreement reached under the previous French President, Nicolas Sarkozy.The Mistral contract dates back to a June 2011 agreement reached under the previous French President, Nicolas Sarkozy.
Western sanctions have been ratcheted up against Russia since March 2014, when the Ukrainian conflict erupted with Russia's annexation of Crimea.
Russia denies backing pro-Russian separatist rebels fighting in eastern Ukraine.