The Airways Corporation says the training of Singaporean air force fighter pilots in New Zealand would be a huge boost to the local aviation industry.
The Government says the global defence contractor Lockheed Martin is in negotiations with the Singaporean air force to train fighter pilots at Ohakea and Whenuapai.
A spokesperson for Lockheed Martin, Kenneth Ross, has confirmed to Radio New Zealand that the company is competing to run the Fighter Wings course for the Republic of Singapore Air Force, which is currently operated in France by another organisation.
But Mr Ross says it would be premature to comment while the tender process is under way.
Lockheed Martin already runs basic training for the Singaporeans in Australia.
The Airways Corporation, which is responsible for managing air traffic within New Zealand, says that if the deal goes ahead it would stimulate growth in the industry and could create more jobs.
Minister hopes for deal in next three months
Economic Development Minister Gerry Brownlee says the two countries already train together and the Singaporean army uses New Zealand's bases. He says he hopes a deal will be struck in the first quarter of this year.
"We do have some facilities here that would make that a possibility," Mr Brownlee says, "and I think that would be very good for the New Zealand air force as well as for the strengthening of our defence relationships."
Radio New Zealand understands that the Ohakea air force base in Manawatu is being considered as the main training base, with a back-up runway at Whenuapai in west Auckland.
The potential deal is being welcomed by Palmerston North mayor Jono Naylor, who says the Defence Force is a major contributor to the Manawatu region, and by Waitakere City mayor Bob Harvey, who says involving Whenuapai in the deal has the potential to benefit greater Auckland.