It confirms orders for 180 A400M military transport planes to be built by Airbus, with delivery from 2008.

The project, costing some 20 billion euros (23.7 billion dollars), is seen as a crucial component of efforts by the European Union to strengthen its own military capability and coordination.

Germany has ordered 60 aircraft, followed by France with 50, Spain with 27, Britain with 25, Turkey with 10, Belgium with seven and Luxembourg with one.

They will replace ageing military transport planes across Europe, such as the US Hercules C-130 and the Franco-German Transall C-160.

Tuesday's signing was made possible after a German parliamentary commission gave the final go-ahead last week for Berlin's order, which had been cut from 73 aircraft last year due to financial problems.

The European aerospace group EADS owns 80 percent of Airbus.

The A400M, with its four turbo-prop engines, will be the world's fastest new-generation aircraft of its kind, according to Airbus.

Capable of flying unrefuelled for 4,400 kilometres (2,750 miles) and at a speed of up to 780 kilometres per hour, it will be a vast improvement on the current generation of transport aircraft.

It will take a maximum payload of 37 tonnes, which could range from heavy armoured vehicles, artillery and helicopters to cargo pallets and troops.

The aircraft is desgined to provide a rapid reaction capability in crisis situations, one of the key areas which the European Union says it wants its burgeoning military cooperation to concentrate upon.

The contract was signed at the base in Bonn, western Germany, of OCCAR, the organisation representing the seven countries.

It was inked by OCCAR's German director, Klaus von Sperber, and Francisco Fernandez Sainz, the Spanish executive director of Airbus Military, the Airbus subsidiary created for the project.

The A400M programme has taken seven years to get off the ground, following the withdrawals of Italy and Portugal and reduced orders both from Germany and Britain.

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