Blow for Britain and BAE Systems as UAE rules out Eurofighter deal In a blow for British jobs and exports, the defence group said: "BAE Systems and the UK Government have been in discussions with the Government of the United Arab Emirates regarding a range of defence and security capabilities including the potential supply of Typhoon aircraft. The UAE have advised that they have elected not to proceed with these proposals at this time. BAE insisted that "recognising the risk, scale and complexity of such a transaction, the group had not built this prospect into its planning assumptions." However, senior BAE executives had been extremely hopeful of winning a contract that would have guaranteed around two more years work for its production and assembly facilities at Salmesbury and Warton in Lancashire. The current Typhoon workload only extends to 2016, while fresh orders also bring contracts for the Hawk training jet. BAE was lead negotiator for the UAE contract within the pan-European Eurofighter consortium, whose other members are Italy's Finmeccanica and Airbus-maker EADS, representing Germany and Spain. A BAE spokesman said: "We put a world-class proposal on the table, but the UAE has elected not to proceed at this time." The company added: "BAE stands ready to work with the UAE to address any future requirements." The setback is an embarrassment for Mr Cameron, who on a visit to Dubai last month said Britain was "in the running" to sell the Typhoon to the Middle East. Speaking as the Eurofighter faced competition from French rival Dassault and its Rafale aircraft, Mr Cameron said he was continuing to "support Typhoon around the world, which is doing extremely well and is clearly in the running here as well, so there's a lot of jobs, a lot of investment to be garnered from visits like this." Mr Cameron also visited the UAE in November last year, when a spokesman for Number 10 issued a statement saying: "The UAE, Saudi Arabia and Oman have all expressed an interest in purchasing Typhoons and the Government is aiming to secure sales of more than 100 aircraft to the region in the coming year, deals that together would be directly worth over £6bn pounds to British firms." A Government spokesman last night denied that the UAE decision was in any way related to Britain's "no" vote on military intervention in Syria, saying: "This was a commercial decision. It was always going to be a difficult deal to do. And as BAE have said, it was an exciting prospect but not part of their business plan. The spokesman added that "the Government continues to support BAE Systems in their efforts to win further export orders," noting that the "Typhoon is a world-leading capability" that had been selected by seven Air Forces - the Eurofighter members and the three export markets. "We continue to have a strong bilateral relationship with UAE that delivers jobs and growth in both countries, for example following the Prime Minister's last visit in November both Emirates and Etihad airlines placed large orders for Airbus aircraft worth more than £5bn to the UK economy," the spokesman said. Zafar Khan, an analyst at Societe Generale, cautioned that he had never seen Typhoon as favourite for the UAE deal. My feeling is that the UAE have a very strong relationship with the French and the current fleet has a lot of Mirage jets in it. So I had always felt that UAE was likely to veer towards the Rafale," he said. BAE's ongoing failure to agree a step-up in prices for 72 Typhoon jets for Saudi Arabia, under the "Salam" contract first negotiated in 2007, will hit this year's profits. BAE said "the group's focus in these negotiations continues to be on agreeing appropriate terms and not the timing of such an agreement." But the stand-off is a setback for BAE chief executive Ian King, who said in August: "We do expect we will close this out in the second half of this year," noting that the Saudis were now talking about increasing the order "beyond the 72." BAE has so far delivered 28 aircraft under the contract and stressed that Saudi Arabia had continued to sign contracts with the company relating to the Typhoon order. They include a £3.4bn deal, running to 2016, for the provision of manpower, logistics and training to the Saudi air force. BAE said its relationship with Saudi Arabia "remains excellent," noting it had agreed £1.5bn of contracts this month for the "supply of guided weapons and Tornado maintenance and upgrades." A BAE spokesman said the after-hours announcement was due to having not been "notified by the UAE government" until Thursday afternoon.