Poland announced today that it has chosen Lockheed Martin F-16 jet fighters to modernize its air force to NATO standards in an order worth about $3.5 billion.

Lockheed Martin Corp. beat out two rival European bids with a U.S. government-backed offer to supply 48 of the planes as well as weapons, pilot training and investment in Poland to help offset the cost of replacing Soviet-made fighters.

"This is an optimum solution for the military security of the state, and it meets our obligation as an ally," Defense Minister Jerzy Szmajdzinski told a news conference.

The Gripen jet, made by a consortium formed by Sweden's Saab AB and Britain's BAE Systems, was considered the U.S. plane's main rival, in part because it was cheaper and would have made a considerable difference for Poland's strapped budget. The French-made Mirage 2000 was also in the running.

But the F-16 had been seen as the most logical choice because it is widely used by NATO nations, and Poles view the United States as their chief ally. "The advanced F-16 will establish Poland's air force as an important contributor in NATO and an aviation leader in Central Europe," the U.S. Air Force said in a statement.

Even before the official announcement, Charles Edelstenne, chairman of Dassault Aviation SA, which makes the Mirage, told a French radio station: "The political element was the chief element, well beyond the quality or the price."

Gripen International spokesman Bjorn Magnusson said it was "a disappointing result for us, but at the same time it was expected that they would pick an American solution for a number of reasons."

Szmajdzinski said the U.S. bid was "optimal for the economy, including the weapons industry" because of the investment and job creation it promised. His deputy, Janusz Zemke, said the F-16s' price tag was $3.5 billion.

Washington padded Lockheed Martin's F-16 bid with the offer of a $3.8 billion loan to Poland with repayment terms of up to 15 years. The U.S. Congress approved the loan in October. U.S. officials have argued that their financial plan is flexible and will depend on Poland's payment ability.

Poland needs 48 fighter jets by 2008 to replace its Soviet-built MiGs and bring the country's military up to NATO standards. The first 16 planes are to arrive in 2006, the remaining 32 within the next two years.

Poland is the largest of the three former Soviet bloc countries that joined NATO in 1999. The other two countries, Hungary and the Czech Republic, opted for Gripens, but the Czechs canceled their order to free up reconstruction aid after devastating floods hit the capital, Prague, last summer.

The first 16 F-16s are to arrive in 2006, with the others coming by 2008.