South Africa

SAAB’S RAPID EXPANSION IN SOUTH AFRICA – AND IT’S NOT SLOWING DOWN

South Africa has attracted a number of international companies dealing in defence technologies, some of which have the largest operation outside of their homeland in the country. Swedish company Saab is one of these companies with over 700 employees in South Africa alone and a strong presence in the African market with offices in South Africa, Botswana, and Kenya. Among its many business areas, Saab is widely known for its aeronautics and avionics systems for military and civilian aircraft. South Africa has become a strategic base for Saab to market its portfolio throughout Africa.

Saab owns Saab Grintek Defence (SGD) in South Africa with African Equity Empowerment Investments (AEEI) completing a R125 million deal to acquire a 25% plus one share stake. SGD’s expanding staff complement in South Africa continues with orders well into 2020. Trevor Raman, President and CEO of SGD, stated that: “We have built a remarkable organisation by partnering with South African companies and investing in skills and enterprise development, to ensure that our hi-tech business has local access to the specialised skills and services we need to meet our global customers’ needs.”

SGD designs and produces electronic warfare and avionics technology for defence forces across the globe (including Germany, Brazil, and the Middle East), stimulating South African exporting revenues (the South African Department of Trade and Industry named SGD Exporter of the Year in 2013 and 2014). India’s Make in India programme benefited from a Memorandum of Understanding (MoU) signed between SGD and Tata Power Strategic Engineering Division (Tata Power SED) in July 2016 to convey locally produced South African technology and products to foreign markets. “We are excited about the signing of this MoU as it is our strategy to take South Africa’s indigenous technology and products beyond local markets with well-established expert partners that add value to our supply chain and open new markets. The transfer of technology for production of initial orders for Saab’s global customers has already commenced at Tata Power SED’s facility in Bangalore,” said Trevor Raman

Indian Prime Minister, Narendra Modi, was present during the signing to promote defence manufacturing in India and create export opportunities for South Africa. Earlier in 2016, SGD and Tata Power SED announced the manufacturing of the Land Electronic Defence System (LEDS) 50 for the Indian market and for export. The system was previously made in South Africa only. The system detects a laser threat in the field and notifies operators when the vehicle has been painted with a laser by opposing forces.

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SGD is heavily involved in command, control and communications systems, and sensor technology. Regarding communication, SGD’s TactiCall solution, currently used by the South African Navy and the South African Police Service, ensures seamless communication between different emergency management services, regardless of the radio band, frequency, or hardware used. The system resolves any breakdown in communication when using a variety of devices.

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SGD has positioned itself as a major player in South Africa essentially expanding from South Africa’s acquisition of the Gripen fighter in the 1990s. SGD’s Centurion campus is located close to Waterkloof Air Force Base with a variety of its products available for demonstration year-round. The company emphasizes its ability to work closely with clients appealing to rapid defence requirements by innovating new technology according to its client’s needs.

Written by Sylvia Caravotas (Satovarac Consulting) for OIDA

DURBAN NAVAL STATION TRANSFORMATION

South Africa’s maritime is receiving much-needed attention to ensure it can manage the escalating security challenges in the region. On the agenda, is the South African Navy’s historic Naval Station on Salisbury Island in Durban, which is undergoing a massive revamp to transform it into a functioning Naval Base.

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Spokesperson for the SA Navy, Cdr P.G. van den Berg, stated that the footprint of the SA Navy in Durban will continue to grow. Durban is not only the busiest commercial port in SA, but a strategic location for the SA Navy allowing ease of access to the east coast of South Africa, Africa, and the Indian Ocean enabling the navy to readily assist with maritime operations.
According to SA Minister of Defence and Military Veterans, Nosiviwe Mapisa-Nqakula, the upgrade will also contribute towards the ocean economy under Operation Phakisa: “This initiative is significant, considering 50% of our trade is through the blue economy. The SANDF and South Africa will be making contributions to the ocean economy in this regard and further increasing capacity as an integral part and leader in Indian Ocean navies.”

The SA Navy was deeply affected by budget cuts in 2002 when the Durban Naval Base on Salisbury Island was downgraded to a Naval Station. However, the Navy began rethinking the station when a surge in piracy made patrolling the Mozambique Channel from Naval Base Simon’s Town on the Cape Peninsula ineffective. At the groundbreaking ceremony in December 2015, Nosiviwe Mapisa-Nqakula stated that: “It is a process to reverse what happened in the past, when there was a decision to downscale and eventually close what was then a budding navy facility and move all the facilities to Simon’s Town. We are now wiser.”

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The upgraded Durban Naval Base will play home-port to the Inshore and Offshore Patrol vessels to be acquired under Project Biro. The plan is to increase the base’s workshop and dockyard capacity to perform all required docking and essential defects (DEDs) and planned maintenance for the patrol vessels. Rear Admiral Bubele Mhlana, Flag Officer Fleet, stated that they would like to avoid ships that are home-ported in Durban coming down to Simon’s Town for maintenance. Project Biro is currently on hold, according to Armscor Chief Executive Kevin Wakeford, due to a review of the budget before a decision on the continuation of the contracting process is made. The situation is similar for the replacement of SAS Protea, the SA Navy’s hydrographic vessel (Project Hotel).

The upgrade has not been without its challenges and the Navy is struggling to regain access to buildings it lost fifteen years ago. Vice Admiral Mosiwa Hlongwane, Chief of the SA Navy, stated that around R200 million is needed to upgrade the facilities and redeploy personnel back to Durban. Although a large undertaking, the newly upgraded Durban Naval Base together with Naval Base Simon’s Town will better position the SA Navy to cover both the west and east coast of South Africa, the region, and will contribute to Operation Phakisa by protecting SA’s territorial waters and maritime resources.

Written by Sylvia Caravotas (Satovarac Consulting) for OIDA

INNOVATIONS AND ALLIANCES AT THE AFRICA AEROSPACE AND DEFENCE EXHIBITION 2016

Undoubtedly marked on the calendars of aerospace and defence connoisseurs worldwide, the biennial Africa Aerospace and Defence (AAD) exhibition showcases the latest technological innovations offering solutions for Africa’s security challenges in the air, on the ground, and at sea. The 2016 AAD expo was open to trade visitors from 14 to 16 September at Waterkloof Air Force Base with exhibits across 7 hangars (indoor and outdoor), static aircraft displays, and hospitality chalets for invited guests.

South African companies such as Paramount Group and Denel impressed with their stands, which were certainly on par with international innovators. Reference must be made to Turkey, who had the largest international pavilion showing an eagerness to explore opportunities in South Africa and beyond. The AAD expo was far from short on large defence suppliers to Africa. Perhaps leading the pack is Russian Defence Export, Rosoboronexport, which according to Yury Demchenko, advisor to Rosoboronexport’s Director General, has orders with African countries exceeding $21 billion. Rosoboronexport operates under the strict supervision of the Russian president and government.

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Two notable South African unveilings at the AAD expo were from Paramount Group and Denel. For the first time in Africa, Paramount Group unveiled its Mbombe 8 infantry fighting vehicle (IFV). The Mbombe 8 is equipped to undertake a wider range of battlefield missions. Founder of Paramount Group, Ivor Ichikowitz, stated that: “South Africa has been leading the world in armoured vehicle and land mine protected technologies for decades and we’re proud to take this heritage into the future.”

Denel unveiled their revolutionary and light DMG-5 machine gun, developed by three young engineers working for Denel Land Systems (DLS) – Dakalo Nekhumbe, Phindile Mashaba, and Marumo Talane. Stephan Burger, CEO of Denel Land Systems, stated that: “The result represents a major breakthrough for Denel, which will definitely contribute to our reputation as one of the leading global innovators in design and advanced manufacturing and among the top 100 defence companies in the world.”

The AAD expo set the stage for the signing and cementing of various partnerships. A strategic alliance was forged between Denel Integrated Systems and Maritime (DENEL ISM) and Hysucat (based in Cape Town), to develop and market its range of patrol vessels. At the Denel stand, Hysucat showcased its 850 rigid inflatable boat, which was fitted with a weapons turret.

On 16 September 2016, a Memorandum of Understanding was signed by Denel and Chinese state-owned Poly Technologies (part of China Poly Group) to breathe new life into South African maritime. The alliance could possibly see the construction of three vessels for the South African Navy in either Simon’s Town or Durban, presumably if Poly Technologies is awarded the Project Biro and Hotel tenders.

On the same date, a Memorandum of Understanding regarding missiles was signed by Denel Dynamics and Saudi company ITEAC Group concerning Denel’s Ingwe missile. Dr. Amin Al-Shanqiti, Board Chairman and CEO of ITEAC, stated that their alliance would support technological transference such as setting up local manufacturing facilities in Saudi Arabia for the Ingwe missile.

Competition can sometimes lead to supportive deals as is the case with South Africa’s Paramount Group and U.S. based The Armored Group (TAG). The two companies are set to promote each other’s vehicles in selected markets. Coupled with Paramount’s military reach and TAG’s strong commercial market presence, this partnership is bound to be hugely beneficial for both.

Bell Helicopter is gaining considerable business from Africa. The U.S. Department of Defense (DoD) has awarded the company a contract to deliver five Huey II helicopters and spares worth $52.1 million to Kenya and five helicopters worth $34.5 million to Uganda. Further, Steve Suttles, Bell Helicopter Vice President for Middle East and Africa, stated that an unnamed African military would receive five Huey II’s this year.

Additionally on the helicopter front, Airbus Helicopters and Denel Aviation signed a Memorandum of Understanding to collaborate in modernising the Rooivalk attack helicopter with a phased programme of enhancements. A Rooivalk helicopter on display at the AAD expo was fitted with an Airbus Defence and Space Optronics Argos II airborne observation system. It will be interesting to see what upgrades they install on this South African classic.

Written by Sylvia Caravotas (Satovarac Consulting) for OIDA

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