Iran's Gulf neighbour, the United Arab Emirates, has signed a deal worth $3.3 billion to buy missiles from US firm Raytheon Company, a newspaper reported on Saturday.

The US Defense Department said in September it had proposed the sale of air defence systems and helicopters to the UAE with a total potential value of more than $9 billion.

The main item in the Pentagon-proposed package was Terminal High Altitude Area Defense (THAAD), worth up to $7 billion. The system is built by Lockheed Martin Corporation with a system radar from Raytheon.

The National, an Abu Dhabi based-newspaper, said the deal was to buy Patriot missiles. The proposed package included up to $121 million for Patriot Advanced Capability-3 Missile Systems from Raytheon and Lockheed Martin.

"The agreement includes technology, training and supply of the medium-range missile system, which is part of a multi-tiered defensive shield the UAE Armed Forces is building to protect the nation from perceived threats in the region," it said.

Gulf Arab nations have voiced concern over Iran's nuclear programme and urged a peaceful solution to a standoff between Tehran and Washington over the Iranian atomic plans.

The United States accuses Iran of planning to build a nuclear weapon. Tehran says its programme is to generate energy. The tension has raised concern in the region of a military confrontation between Tehran and Washington.

In recent years, the UAE has acquired advanced weapons systems from several countries, including the United States.-Reuters