The contract for the 10-year lease of the supersonic fighters manufactured by a BAE Systems and SAAB consortium, which will renew the airfleet protecting the Czech Republic's airspace, is worth 19.65 billion euros (629 million euros, 757 million dollars).

"The government approved the purchase of 14 supersonic Gripens, I am very happy that... the protection of the Czech Republic's airspace will be so secured and that our country will be able to fulfill its international obligations, in the integrated defence system of NATO," Kostelka told reporters.

While the government agreed in principle to lease the planes six months ago, it has been ironing out the final price and conditions and only gave the green light at a closed meeting Wednesday.

Initially the cost was expected to be 21 billion koruna, but the Czechs later negotiated a lower price.

The agreed contract also includes a so-called "offsets" programme of investment into the Czech economy, worth 130 percent of the value of the contract, in return, Kostelka added.

Of that, 20 percent will be in the defence industry.

Under the contract Czech pilots and support staff will also be trained in Sweden.

The first Gripens should come into use by the Czech military in spring 2005, replacing the Soviet MiG-21s, whose service life expires next year.

They will be based at Caslav, 70 kilometers (43 miles) east of Prague

The government opted for Gripens over the Belgian offer of updated F-16 fighters from Lockheed-Martin and similar planes from the Netherlands. Canada offered F/A-18 fighters by Boeing and the United States offered an older variant of F-16s.

The Czech Republic joined NATO in 1999; Sweden is not a member of the alliance.

The manufacturer insists however that the Gripens are capable of fully cooperating with NATO's air forces.

"The planes are perfectly interoperable within the NATO framework," insisted Kostelka, refuting claims in the media that the planes would not be NATO-compatible.

There was been widespread opposition to the purchase.

Petr Necas, the shadow defence minister for the Civic Democratic Party (ODS), described the decision as rash, and said it was a negative move for the Czech Republic and its army.

"The government did not even try to look for other alternatives, it did not try to use the subsonic L-159s temporarily, it did not try to negotiate with allies on the temporary cover of Czech air space," Necas said.

A date for the signing of the contracts has not yet been announced.

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