Tuesday, November 27, 2007

Airbus Part of $30 Billion in Contracts With China

The aircraft maker Airbus and the French nuclear company Areva were among half a dozen companies to sign roughly $30 billion in contracts yesterday with Chinese partners.

The deals, signed during a three-day visit by President Nicolas Sarkozy of France, offered further evidence of the value of China as a market for European technology despite tensions over trade and the environment. The deal included a promise by Airbus to award to Chinese companies at least 5 percent of the supply contracts for its next-generation widebody jet, the A350-XWB.

Airbus, which is playing catch-up to Boeing’s Dreamliner in terms of orders, has offered such a sweetener once before outside the euro zone — to Russia.

The European plane maker is also trying to reduce its vulnerability to swings in the dollar. Executives at Airbus and its corporate parent, European Aeronautic Defense and Space, have warned that the dollar’s decline poses a serious threat to the company’s viability.

The corporate announcements came on the eve of a meeting in Beijing between European officials, including the central bank president, Jean-Claude Trichet, and their Chinese counterparts. Mr. Trichet and others were expected to press China to allow faster appreciation of its currency, the yuan, whose value is closely pegged to the dollar.

European officials have accused Beijing of keeping the yuan undervalued to lift exports. China’s trade surplus widened 50 percent, to $13.9 billion, in October from a year earlier, according to Chinese statistics. Europe estimates that China’s trade surplus could reach $252 billion this year — a 30 percent increase from 2006.

The orders announced Monday — described by Mr. Sarkozy as unprecedented for French industry — should help make a dent.

Airbus received orders from Chinese airlines for 160 passenger planes worth about $14.8 billion at list prices, while Areva won an $11.9 billion agreement to build nuclear reactors, a record for the company.

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