US objections derail Israel's sale of fighter jets to Croatia

A $500 million deal involving the sale of 12 used Israeli fighter jets Croatia will likely be cancelled due to US objections, Croatia's defence minister said on Thursday.

Israel reached a tentative deal with Croatia in March for the sale of the upgraded F-16 Barak fighters, however, required US approval to finalise the sale of the American-made technology to a third party.

Croatian Defence Minister Damir Krsticevic said after meeting with Israeli defence officials in Zagreb on Thursday that "despite accepted obligations", Israel failed to obtain the needed consent and his ministry "will propose to the government to make appropriate decisions".

The deal was due to be Croatia's its largest single military purchase since it split from the Yugoslav federation in a bloody war in the 1990s, however, Krsticevic said its collapse would not negatively impact upon the country's finances.

Krsticevic has faced calls for his resignation over his handling of the agreement.

The deal ran into trouble after Washington said that upgrades that were added after Israel took delivery of the aircraft from the United States some 30 years ago would have to be stripped before re-sale.

The sophisticated electronics and radar systems were crucial in Croatia's decision to buy the F-16s from Israel instead of from the US or Greece, which also bid for the contract.

Despite increased closeness between Tel Aviv and Washington under the Trump administration, the jet deal appears to be an exception to the two governments' broad agreement on defence issues.

US Secretary of State Mike Pompeo and Israeli Prime Minister Binyamin Netanyahu met earlier this month but didn't agree on a way to end the impasse.

The director-general of the Israeli Defence Ministry, Udi Adam, traveled to Croatia on Thursday in an apparent attempt to save the deal.

He said at a joint media conference with the Croatian defense minister that "sadly, the conditions were not right (for finalising the deal) because of the circumstances that were beyond our control".

Israel is trying to get rid of its aging F-16s that will be replaced with more modern F-35 fighters.

NATO member Croatia faces a mini arms race with Russian ally Serbia, which recently received six used Russian MiG-29 fighter jets.