US defense contractor Lockheed Martin says the US army has signed a letter of agreement with Taiwan to sell more than 400 Hellfire missiles in a deal worth US$50 million.
The Ministry of National Defense did not respond to the Lock-heed Martin announcement, citing its standard procedure of not commenting on arms purchases.
The Lockheed statement said the deal would involve the sale of more than 400 AGM-114M blast-fragmentation Hellfire rounds. Hellfire is an air-to-ground, laser-guided, subsonic missile with significant antitank capacity.
It can also be used as an air-to-air weapon against helicopters or slow-moving fixed-wing aircraft.
"The Taiwanese Hellfire purchase comprises the largest part of the US government's Hellfire missile ... contract award to Lockheed Martin. The new contract equates to approximately six months of activity on the Hellfire production line at Lockheed Martin's manufacturing plant in Troy, [Alabama]," the statement said.
"The Taiwan portion represents approximately 70 percent of the rounds to be delivered, between 5-10 percent are earmarked for Israel, with the balance going to the US army. Work on the missiles began earlier this year," it added.
Lockheed Martin said that in Afghanistan and Iraq, Hellfire proved extremely effective against ships, light armor and urban targets.
"Hellfire's lethality and combat-proven performance, coupled with its precision-strike capability, provides Taiwan with the best air-to-ground weapon system in the world," the statement quoted Mark Stenger, director of the Air-to-Ground Missile Systems Program at Lockheed Martin Missiles and Fire Control in Orlando, as saying.
"Taiwan's decision to purchase Hellfire ensures its military's interoperability with the US army, marine corps and special operations forces deployed worldwide," it said.
Military analyst Lee Shih-ping said the missiles could be used to block an amphibious landing on Taiwan in the event of an attack by Chinese troops.
"They are probably laser-guided missiles to be equipped on OH-58D or AH-1W attack helicopters. It is a large supply if you consider how many tanks they can hit," Lee said.
Beijing has strongly protested US arms sales to Taiwan, calling them "the main obstacle" to unification of China.
Washington's largest arms sale to Taiwan involved 150 F-16 warplanes, approved in 1992 by former US president George Bush.
The Legislative Yuan is currently debating a NT$610.8 billion (US$19.2 billion) budget to buy eight diesel submarines, 12 P-3C anti-submarine aircraft and six sets of PAC-III anti-missiles from the US.
US President George W. Bush approved the sale in 2001 to boost Taiwan's defenses, but opposition lawmakers have been blocking passage of the budget, saying the prices are too high and the delivery too late.