France opens first Gulf military base in UAE

French President Nicolas Sarkozy formally opened a French military base in the United Arab Emirates on Tuesday, the country's first in the oil-rich Gulf region, as Paris eyed multi-billion-dollar deals to supply the UAE with nuclear power plants and advanced military aircraft.

The French and UAE flags were raised at the so-called "Peace Camp" in Abu Dhabi at a ceremony also attended by UAE Deputy Prime Minister and Interior Minister Sheikh Saif bin Zayed al-Nahayan.

The base will host up to 500 troops stationed in three sites on the banks of the Strait of Hormuz, just across from Iran: a navy and logistical base, an air base with three fighter planes and a training camp.

French officials said the naval base in the UAE, the world's third-largest petroleum exporter, would deepen ties to the Gulf Arab state and fortify efforts to battle piracy and defend trade.

"We look at this cooperation as an important pillar of our foreign policy because it helps the stability in the Gulf region," UAE President Sheikh Khalifa bin Zayed al-Nahayan said in comments read at a maritime security conference on Monday.

The base is France's first major foreign military installation since the 1960s and its first outside Africa. It is expected help safeguard vital Persian Gulf shipping lanes.

The two countries also announced that the UAE will station diplomats at French embassies in countries where the country has no diplomatic representation.

We look at this cooperation as an important pillar of our foreign policy because it helps the stability in the Gulf region

UAE President Sheikh Khalifa bin Zayed al-Nahayan

Nuclear competition

France also made it clear that its firms intend to compete for the UAE's nuclear reactor business. The UAE plans to build a number of nuclear reactors to meet an expected need for an extra 40,000 megawatts of electricity by 2017.

Last week U.S. President Barack Obama signed a civilian nuclear deal with the UAE setting the stage for Congress to decide whether to block it.

American nuclear reactor builders GE and Westinghouse Electric Co, a subsidiary of Toshiba Corp., stand to get a big share of the expected $40 billion market if the U.S. Congress approves the deal.

French firms plan to compete for the business, as do British firms. France's Total, Suez, and state nuclear reactor maker Areva said last year they planned to develop two third-generation nuclear reactors in the UAE.

A source close to Sarkozy, who arrived in Abu Dhabi on Monday night, told reporters that state-controlled power firm EDF would be joining the French consortium.

Sarkozy is also scheduled to formally launch the construction work on a branch of the French Louvre museum, which will be built on an island off Abu Dhabi.