IT WAS THE deal of the year in central and eastern Europe - not a sovereign Eurobond, a corporate high-yield issue or an IPO, but a transaction that emerged from the heart of the military-industry complex. It was the biggest debt financing of the year - a $5.5 billion off-balance-sheet deal arranged by JPMorgan and guaranteed by the US government. You haven't read about it, because it was to finance Poland's acquisition of 48 F-16 military aircraft from Lockheed Martin.
That deal was signed in March 2003. The same month it went through, Poland agreed to send about 3,000 troops to Iraq. Euromoney spoke to a banker involved in the syndication of the financing. "We understood what the deal was," he said. "The US government finances the deal at good rates. In return, Poland supports the US in Iraq."
Every other eastern European country that has...
