Boeing, the main contractor for modernizing NATO's fleet armed with the Airborne Early Warning and Control System, or AWACS, is expected to sign an offset agreement worth 10 million U.S. dollars with Hungary in the first quarter of 2006, a Hungarian official said Wednesday.

The amount contains 2.5 million dollars worth of purchases from the American aircraft manufacturer dating to 2001, when Hungary decided to acquire Gripen fighter planes from Sweden instead of U.S. F-16 fighters, said Sandor Szabo, head of the economics and transport ministry's offsetting department.

The accord will be a follow-up to the Dec. 22 agreement under which Hungary joined the North Atlantic Treaty Organization (NATO)'s Airborne Early Warning and Control Program Organisation.

According to the new offset trade principle, the new offset agreement will prioritize projects designed to boost the development of the Hungarian defense industry, the economics and transport ministry noted in a document released on Wednesday.

Source: Xinhua