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STATEMENT ON DEFENCE AQUISITION PACKAGE, 18 November 1998
The Cabinet today considered the report from the Cabinet subcommittee on the Procurement Program for the South African National Defence Force. The report and recommendations covered the military equipment, the defence and industrial participation, the national industrial participation program and the financial implications of the program were dealt with by the Finance Ministry.
The sub-committee made recommendations on the six core defence procurement programmes. The sub-committee recommended that the seventh program for battle tanks not be considered at this time.
The sub-committee also made recommendations on the preferred suppliers. The total industrial participation programmes were set out for Cabinet. This is a major project for the SANDF and is in effect a major industrial investment program that will be carried out with the European suppliers. Cabinet authorised the sub-committee and the Minister of Finance to enter into further negotiations with the preferred suppliers to achieve an affordable final package.
The sub-committee will report back to the Cabinet. These negotiations will commence shortly. In addition all bidders will receive a debriefing in the next few days. A summary of the preferred suppliers, the package and indicative figures is set out in the attached page (Annexure A)
The preferred suppliers are:
PRODUCT; PREFERRED SUPPLIER; QUANTITY; VALUE; ESTIMATED IP VALUE; JOBS
1. CORVETTES: German Corvette Consortium; 4; R6 001m;
R16 007m; 10 153
2. SUBMARINES: German Sub. Consortium; 3; R5 212m;
R30 274m; 16 251
3. MARITIME HELICOPTERS: GKN Westland, UK; 4; R787m;
R2 720m; 2 536
4. LIGHT UTILITY HELICOPTERS: Agusta, Italy; 40; R2 168m;
R4 685m; 4 558
5. LIGHT FIGHTER AIRCRAFT: SAAB, Sweden Bae, UK; 28;
R10 875m; R48 313m; 23 195
6. LEAD IN FIGHTER TRAINER AIRCRAFT: BAe, UK; 24;
R4 728m; R8 580m; 7 472
TOTAL JOBS: 64 165
The quantities of the products are in line with the revised recommendations based on the Defence Review. The strategic packages ensure both Defence and Development for our country.
INDUSTRIAL PARTICIPATION OVER 7 YEARS PER PROGRAM
PRODUCT; COST; INVESTMENT; EXPORTS; LOCAL SALES; NO OF JOBS
1. CORVETTE: R6 001,25m; R2 112m; R2 109m; R11 786m;
10 153 2.
2. SUBMARINES: R5 212,50m; R6 262m; R22 950m; R1 062m;
16 251
3. UTILITY HELICOPTER: R2 168,75m; R 431m; R2 847m;
R1 407m; 4 558
4. MARITIME HELICOPTER: R 785,50m; R 268m; R 227m;
R2 225m; 2 536
5. TRAINER AIRCRAFT: R4 728,13m; R2 552m; R4 566m;
R1 462m; 7 472
6. FIGHTER AIRCRAFT: R10 875,00m; R14 387m; R26 481m; R7 445m; 23 195
TOTAL: R29 773,00m; R26 012m; R59 180m; R25 387m; 65 000
COST: R 29 773m
IP: R110 000m
JOBS: 65 000
Issued by: Ministry of Defence
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