According to earlier announcements from Croatian State top, in that case the Government will annul its decision to accept Israel's offer, after which several options are available.
Prime Minister Andrej Plenković announced earlier that the competition will be scrapped, while head of Defense Ministry's commission for choosing fighter jets Davor Tretinjak said that more discussions will take place and added that the Defense Ministry will propose a plan B to the Government.
Issues with price
After the competition is annulled, three options will be available. The first option is for the Defense Ministry to invite Swedish SAAB aerospace and defense company representatives, whose offer of new Gripens ranked second, and start negotiations. Price could present a serious obstacle to closing a deal with the Swedish company. SAAB offered 12 new JAS 39s for EUR 903 million plus 30 million for armaments and infrastructure, but at the same time sent signals that it is prepared to present a more affordable offer.
In case the competition is annulled, Croatia will have several options at its disposal. One option is to launch a new competition and invite offers. Another option is to enter strategic partnership with USA with the aim of jet procurement. According to available information, the Defense Ministry is aware that the deal with Israel fell through and is deliberating what to propose to USA.
New proposal
According to unofficial sources, one of the options is making an arrangement with USA on donation of F-16 C/D Block 25s which would be upgraded to Block 50/52 and undergo a service life extension program (SLEP), which would extend life to 12,000 hours. The jets in question are some 30 years old and currently in USA.
According to estimates, the whole package, including infrastructure and logistics, could cost some USD 600 million, which is about 100 million more compared to Israel's offer.
It is worth noting that Bulgaria got a very bad deal in 2013 when the country closed a jet procurement contract with USA - it bought 9 single-seaters F-16As and three two-seaters F-16Bs.
The jets cost USD 120 million, while overhaul, modernization, training, armaments, logistical support and adaptation of infrastructure cost 508 million.
On the other hand, some have been speculating for several weeks after the deal with Israel fell through that USA has proposal that could ameliorate the situation.
According to available information, USA already offered several solutions to Croatia since the launch of the competition, but the offers were turned down and it would not come as a surprise if they were reexamined.
Greek offer
According to our interlocutors, US Embassy representatives proposed to ranking Croatian Defense Ministry officials in 2017 that Croatia should pick F-16 and later pick the country (USA or some other country) from which to buy new or used F-16s.
According to our interlocutors, Embassy representatives proposed that, if Croatia opts for new jets, it should buy 6 to 8 jets in the first phase, and additional 4 to 6 later.
USA offered a different option - upgrade of used F-16 C/D Blocks to F-16V, with characteristics very similar to the latest F-16 Block 70/72.
The biggest obstacle in this case is price. It is estimated that such an arrangement could cost Croatia about USD 800 million, which is enough to buy new Gripens. The F-16s that Greece offered could be reconsidered, which is an offer that USA supported wholeheartedly.