DGA, the French arms procurement agency, last year spent €9.87 billion ($12.1 billion) on equipment orders for the French armed forces under the country’s 2003-2008 defense budget. This accounted for a 15.3-percent increase over 2003 investments and included €1.3 billion ($1.6 billion) in research funding.

According to DGA chief executive François Lureau, the agency’s total research and technology (R&T) investment increased 10 percent in 2004. This included €462 million ($568 million) in future technology research funds for the industry.

DGA manages 78 design and production programs worth a total of €116 billion ($143 billion). During 2005 it will spend €559 million ($688 million) on research and technology work–a 20-percent hike on 2004. The annual amount will rise to around €700 million ($861 million) toward the end of the 2003-2008 budget period.

At a recent press conference, Lureau admitted that only 7 percent of R&T spending went on orders to small and medium-sized companies and confirmed that this would rise by 50 percent this year. Citing Dassault’s Rafale fighter and Eurocopter’s Tiger attack helicopter, he said the DGA is working with industry on late-running contracts, but added that despite some small problems, the Airbus A400M military transport program is on schedule. The DGA chief declared himself happy with the way the agency is managing program costs, which last year showed a “modest” overspend of 0.7 percent.

About 30 percent of France’s R&T spending will go on technology demonstrator projects such as the EuroMale unmanned combat air vehicle and the BOA air/land operational bubble. An agreement on Dassault’s Neuron combat drone demonstrator that brings together five European countries is expected to be signed here at the Paris Air Show this week.