Surprising many in the West, Turkey has selected a Chinese firm under U.S. sanctions to build its long-range air and missile defense system (T-Loramid) with low cost and possibility of a technology transfer.
Both NATO and Washington expressed deep concerns and warned that the Chinese missile system will not be interoperable with the alliance’s missile defense umbrella. To ease the Western concerns, Turkish officials said the choice of Chinese firm to build the missile defense system is not yet final but it is highly likely that Turkey will conclude the $3.44 billion deal with the China Precision Machinery Import and Export Corp (CPMIEC) within six months.
The Chinese firm outbid the Franco-Italian company Eurosam and its SAMP/T Aster 30 missile, Russia's Rosoboronexport's S-400 and Patriot air defense batteries from U.S. contractors Raytheon and Lockheed Martin.
U.S. State Department spokeswoman Jen Psaki publicly expressed her country’s concerns to Turkey. "We have conveyed our serious concerns about the Turkish government's contract discussions with the U.S.-sanctioned company for a missile defence system that will not be inter-operable with NATO systems or collective defense capabilities," Psaki said.

Downplaying Western concerns

Cyber-security concerns and the fact that NATO will have to swap technical data with the Chinese firm will undoubtedly complicate the construction of the missile defense system.
Turkey clearly doesn’t want to pivot away from NATO to China and views the defense deal as probably a significant chance to learn know-how of the missile production.
Mahir Zeynalov
NATO Secretary-General Anders Fogh Rasmussen said last week that what is important for NATO is that the “system acquired by the individual country ... must be able to work and operate with the systems in other countries. I expect that Turkey will also comply with that."
Turkey’s Defense Minister Ismet Yilmaz said on Saturday that four reasons motivated Turkey to select the Chinese firm: Technology transfer, co-production, quick delivery and low cost.
Most Turkish officials downplayed Western concerns over the choice of the Chinese firm and highlighted the fact that Turkey’s primary goal is to be able to produce its own missile defense system. Sources said U.S. and European firms refused to co-produce missile defense systems with Turkey but China has no restrictions on technology transfer and co-production.
Turkish Foreign Minister Ahmet Davutoğlu rejected claims that the government has an agenda in selecting the Chinese firm and said it was a “professional choice.” The same minister, however, said shortly before the deployment of six batteries of Patriot missile defense systems in southern Turkey that the country’s air defense system is integrated in three-stage framework that will provide maximum protection for the NATO's only Muslim member. He said Patriots will deal with short-range ballistic missile threats while mid-range missiles will be intercepted by Terminal High Altitude Air Defense (THAD) and AEGIS in the Mediterranean will be responsible for long-range missiles threatening Turkey. It is not clear how CPMIEC’s FD-2000 missile defense systems will be integrated into NATO defense systems.

Turkey’s military secrets

History shows that states usually buy arms from allied countries and the importing country slowly shifts its alliance toward the supplying state. Turkey clearly doesn’t want to pivot away from NATO to China and views the defense deal as probably a significant chance to learn know-how of the missile production. Unable to force U.S. and European bidders to share the missile technology with Ankara, Turkey is looking towards China for the opportunity. But why would Turkey choose a long and painful and probably more costly path to produce its own missile defense system instead of asking Western companies to provide it?
In the past few years, Turkey was at odds with NATO in the case of sharing its defense secrets with Israel, particularly after Ankara agreed to host the alliance's key radar system in Malatya. Despite Turkey’s strong opposition, Washington said they will share the defense intelligence with Israel.
The capability to produce its own missile defense system seems to be Turkey’s only solution in keeping its military secrets out of Israel’s hands and the Chinese defense firm is offering this golden opportunity.
It should not be a co-incidence that the Wall Street Journal published a lenghty profile of Turkish intelligence chief Hakan Fidan on Oct. 10, citing senior Western and Middle East officials who accused him of passing classified U.S. intelligence to Iran, tolerating and arming radical groups in Syria and charting an independent policy without close consultation with Turkey’s Western allies. It is not clear if Fidan had a role in selection of the Chinese firm. Israel has long publicly complained about Fidan for having close ties with Iran. Fidan, an academic and expert on foreign intelligence, is known to be the mastermind of Turkey’s vibrant and pro-active foreign policy in the Middle East in the past three years.
Turkey has made it clear that it wants to possess the capability to produce its own missile defense system and there are strong indications that the primary motive for this is to deny Israel its defense secrets.