Turkey has cancelled a long-range missile defence system tender won by China in order to develop its own defence technology.
Earlier this year, an official from Turkey's Defence Industry Undersecretariat told Reuters, the $3.4bn deal was in jeopardy due to China’s reluctance to allow a technology transfer that would enable Turkey not only to operate the system but also possibly to build a next one on its own.
"It has been decided that this tender will be cancelled," an official at Prime Minister Ahmet Davutoglu's office said. "This decision has been signed off by the Prime Minister this week. Turkey will now launch its own project to build such a defence system."
Turkey’s selecting China’s Precision Machinery Import and Export Corporation as the preferred candidate for the deal in 2013 infuriated its Nato partners because of the possible security risks associated with Chinese technology.
The Chinese firm was chosen over US Raytheon and a Franco-Italian consortium between Thales and missile-maker MBDA.
Turkey was previously reluctant to say whether it planned to integrate the new system with existing Nato infrastructure.
Chinese Foreign Ministry spokesman Hong Lei, asked about the tender being cancelled, said on Monday he did "not have any knowledge on the relevant matter". He did not elaborate.