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China aviation giant spins off defence branch: report

by Staff Writers
Beijing (AFP) March 27, 2009
China's largest aircraft maker has spun off a 7.3 billion dollar independent defence manufacturing branch that will seek to produce top military hardware for global markets, state media said Friday.

The Aviation Industry Corporation of China (AVIC) established the aviation defence branch office Thursday in Beijing to separate the plane manufacturer's civilian and defence operations, Xinhua news agency said.

The new branch will take over most of AVIC's defence business and oversee 10 assembly plants and research institutes which have combined assets of 50 billion yuan (7.3 billion dollars), the report said.

"We are trying to become a world leading defence products supplier by expanding our overseas market for export," the report quoted Wang Yawei, general manager of the defence branch, as saying.

Building combat aircraft, including China's homemade third generation fighter jet the J-10, will remain a core task for the branch, it said.

Xinhua did not give a formal name for the defence branch, which will also continue to manufacture AVIC's L-15 Falcon, a supersonic training aircraft, and the FC-1 Fierce Dragon, a light-weight multipurpose fighter, for export.

In November 2008, the Chinese government formed AVIC by merging the nation's two largest airplane manufacturers in an effort to establish an aviation giant.

AVIC owns 22 listed companies in China, Xinhua said.

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