US blocks sale of Army's old personnel carriers

Sixty decommissioned Army vehicles will probably be turned into scrap metal after the United States vetoed a $1 million sale to an Australian dealer.

New Zealand bought the M113 armoured personnel carriers from the United States about 40 years ago, on the condition that the State Department approved any future sale of the vehicles.

A private Australian dealer won the tender, but the sale was vetoed under new security measures in the United States.

Australian dealer James Swan, who won the contract, said the US should compensate New Zealand.

It was understood that Mr Swan was going to pay just over $1 million.

New Zealand Minister Ron Mark said the vehicles could have been "combat effective" in Iraq today if the Government had spent about $215 million to upgrade them.

But James Funnell, spokesman for Defence Minister Mr Goff, said that the vehicles were "dinosaurs" and unsuitable for modern Army use.

The Government would be looking at other options for the fleet, but considering the United States position, turning them into scrap metal seemed likely.

Mr Funnell said the decision by the Americans came as no surprise, but the Government was optimistic the sale would have been approved.

"We were hopeful that they would recognise that our M113s are 50 years old and are basically dinosaurs, but unfortunately a far more modern variant - goodness knows how many generations newer than our ones - are still used by the Americans, therefore they classify it as of being strategic importance."

- NZPA