France Confirms Future Warship Delivery to Russia

President Francois Hollande won broad domestic applause on Tuesday for defying allies Britain and the United States by confirming plans to deliver a helicopter carrier to Russia, with one backer dismissing the objections as hypocritical.

Speaking on the eve of an EU meeting to discuss sanctions on Moscow over the downing of a civilian airliner over Ukraine, Hollande said late on Monday that a first Mistral warship would be handed over on schedule in October but a decision on a second would depend on Russia's attitude.

It was the clearest signal yet that Paris will go through with the controversial deal despite the Ukraine crisis and came only hours after British Prime Minister David Cameron said it would be "unthinkable" for his country to fulfill such an order.

The United States has also said it opposes the sale, which has exposed France to criticism that it is putting its own interests ahead of Western solidarity over Ukraine.

"Hollande is not backing down. He is delivering the first (ship) despite the fact he is being asked not to," Jean-Christophe Cambadelis, head of Hollande's ruling Socialist Party, told i>Tele television on Tuesday.

"This is a false debate led by hypocrites ... When you see how many (Russian) oligarchs have sought refuge in London, David Cameron should start by cleaning up his own backyard."

The 1.2-billion-euro ($1.62 billion) contract for the two warships, signed by then-president Nicolas Sarkozy's conservative government in 2011, was the first by a NATO member country to supply Russia with military equipment.

Reacting to news the warship would be delivered, Lithuanian President Dalia Grybauskaite accused Europe of weakness and compared its stance on Russia to that on Adolf Hitler before the outbreak of World War Two.

"If European states keep on acting as indecisively as until now, this is a direct invitation for the aggressor to be more aggressive and go further. In 1930s, Nazism wasn’t stopped, and now aggressive Russian chauvinism isn’t being stopped," she told LRT public radio.

Some 400 Russian sailors arrived in France on June 30 to begin training on the first Mistral, named Vladivostok. They are being housed aboard a Russian ship docked in the western port of Saint Nazaire and have kept a low profile. They are due to stay until late-September.

President Barack Obama expressed concerns about the Mistral contract in June because of Russia's annexation of Crimea and support for separatists in eastern Ukraine. A senior U.S. administration official said on Monday Washington continued to oppose the deliveries. "Just because the Americans say 'jump' we shouldn't jump," Xavier Bertrand, a former minister under Sarkozy and senior member of his conservative opposition UMP party, told France Inter radio. "France's word, its signature, must be respected."

Lukewarm Welcome

The wrangling over the warships highlights the difficulties the European Union has had in agreeing a joint line on dealing with Russia, a major gas supplier to countries such as Germany and Italy, as well as to central Europe.

While pressure for tougher action has mounted following the shooting down last week of a Malaysia Airlines plane in an area of eastern Ukraine controlled by the separatists, EU foreign ministers were not expected to deepen sanctions significantly on Tuesday.

Diplomats said it was more likely they would agree to hasten implementation of measures already agreed against Russian individuals at their meeting in Brussels.

With the French economy stagnant, unemployment stuck above 10 percent and Hollande's poll ratings at record lows, cancelling the Russian order would have dented the popularity of his Socialists around Saint-Nazaire, where the shipyards have long been a major employer.

France faces penalties if it does deliver the ships on time. One industry source said France would have to pay back at least 600 million euros if it did not deliver the first Mistral ship.

"If these ships hadn't come along three years ago, we don't know if the company would be around today," Johan Jardin, a delegate for the CFDT trade union at the STX shipbuilding firm told Reuters. "In a way these ships saved our skins."

Protests in the port against the presence of the Russian sailors have drawn only a few dozen demonstrators. Local critics of the contract, such as a local official in the Greens ecologist party, are few and far between.

Yet despite the fact that local traders have welcomed the sailors as a boost to business, town authorities have sought to keep their presence in the town as low-key as possible.

A town hall official said the sailors would be given a civic reception "probably around end-August" if they requested it and they had been allocated reserved slots to use municipal sport facilities but had not yet made use of them.

"Then again, perhaps they have not been informed of them," the official added.

($1 = 0.7416 Euros)

BY YANN LE GUERNIGOU AND GUILLAUME FROUIN (C) Reuters 2014.