Germany Plans to Purchase Israel’s Arrow-3 Missile Defense System for Almost $4.3B

Edited by: Fern Sidman

It appears that Germany is planning to purchase Israel’s Arrow-3 missile defense system for almost 4 billion euros ($4.30 billion), according to published reports. According to a report on the eurasiantimes.com web site,  the purchase is considered part of a larger overhaul of the German Armed Forces after the Russian invasion of Ukraine.

The documents suggest that the German Parliament will reportedly ask lawmakers to release advance payments of up to 560 million euros as early as next week, the eurasiantimes.com reported on Saturday. Berlin has decided to sign a government-to-government agreement with Israel on purchasing the Arrow-3 system before the end of the year, as was reported by the paper.

According to these papers, if the deal fails, Germany will have to forfeit all or part of the advance payments to Israel because they would have been used to cover its costs. The eurasiantimes.com also reported that If it goes through, Berlin will receive the Arrow-3 system by the fourth quarter of 2025.

Neither Germany nor Israel has made an official statement on this development yet, the report stated. If the deal goes through, Germany will become the first-ever export customer of the system.

In September last year, on his visit to Germany, the then-Israeli Prime Minister Yair Lapid confirmed that the talks were on the export of the system but stopped short of specifying how many of the Arrow-3s would be sold to Berlin, the eurasiantimes.com reported. At the time, media reports had predicted a potential price tag of around $2 billion.

Reuters reported that the Arrow-3 is designed to intercept ballistic missiles outside of the earth’s atmosphere. It is the top layer of Israel’s missile defense array, which extends from the Iron Dome missile system that intercepts short-range rockets to Arrow-3’s long-range missiles that destroy any non-conventional warheads at a safe altitude.

While Patriot and IRIS-T cover the medium layer of air defense, Arrow-3 – produced by Israel Aerospace Industries (IAI) (ISRAI.UL) – offers protection for the higher layer, Reuters reported.  The eurasiantimes.com reported that the Arrow-3’s interceptor component is made to transport a kinetic death vehicle outside the Earth’s exo-atmosphere, where it physically collides with the target and decimates it during its mid-course flight phase.

The Times of Israel reported that Israel’s Defense Ministry said that as the system was co-developed with the United States, the export process to Germany was contingent on the approval of Washington.

As for Germany, the Russian invasion of Ukraine changed its entire security calculus and triggered a massive military modernization, the eurasiantimes.com reported. After watching the war unfold in Ukraine over the last 15 months, Germany has visibly turned its attention to bolstering its missile defense.

Last year, Andreas Schwarz of German Chancellor Olaf Scholz’s SPD party, who sits on the parliamentary budget committee, said: “We must better protect ourselves against the Russian threat. To do that, we need quickly an anti-missile shield for Germany,” he said, as was reported by The Times of Israel. “The Israeli Arrow 3 system is a good solution,” he told Bild daily at the time, the TOI report stated.

Scholz said Germany was looking to bolster its ground-based air defenses in the future and is “very keen to work with Israel on that.” The German leader described the Arrow 3 as a “very effective product,” the eurasiantimes.com reported.

The deployment of the system in Western Europe will give a unique capability to the region, according to military experts, the eurasiantimes.com reported.

Moreover, the war in Ukraine has also exposed the shortage of ground-based air defense systems within NATO, including the Raytheon Patriot units. The euasiantimes.com reported that Germany had about 36 Patriot units during the height of the Cold War. However, the German forces are down to some 10-12 now, with some deployed in other states, including Slovakia. One unit of Patriot has also been delivered to Ukraine.