Navy frigates boost IT sector

By Leon Engelbrecht
Johannesburg, 15 Nov 2007

The South African ICT industry was a direct beneficiary of the defence industrial participation (DIP) programme surrounding the SA Navy`s acquisition of four frigates.

Speaking at a ceremony to mark the completion of the frigate-related DIP programme, Armscor senior DIP manager Brenzia Potgieter said Siemens Pinetown was among the small and large companies benefiting from frigate DIP contracts. Siemens Pinetown assembled the ships` electrical plants and provided them with an Integrated Platform Management System (IPMS). Armscor is the state arms acquisitions agency.

Potgieter said Siemens participated directly in the offset programme, supplying significant elements of the frigates` electrical system, as well as its IPMS.

Speaking more generally, Potgieter said: "South African manufacturers benefited directly from offset contracts worth R860 million at current exchange rates." DIP is investment, technology transfer, services and sales directly related to the defence equipment being acquired.

DIP requires foreign defence manufacturers supplying SA to source components and systems from local manufacturers, assemble essential elements locally, and transfer skills and technologies to local partners, while assisting local manufacturers to integrate into the global economy. Armscor is responsible for monitoring DIP performance, while the Department of Trade and Industry monitors the separate civilian offset component known as National Industrial Participation.

The frigate DIP relates only to the platforms and not to the combat systems, which were installed in SA "with a high local content".

The four Valour Class MEKO A-200-SAN frigates have all been taken into full service by the Navy, following the commissioning of the fourth ship, the SAS Mendi, in Port Elizabeth, in March.

Local content

Potgieter said the skills and technology transfer programmes, which were an integral part of the DIP programme, will ensure the frigates and their key systems can be maintained in SA by South Africans in future.

ThyssenKrupp offset manager Ulrich Scheel said the DIP system has been a "tremendous success, ...ensuring not only the integration of South African components onto the frigate platforms built in Germany, but also securing skills and technologies for SA relevant to shipbuilding, engineering more broadly, and other aspects of the economy".

"We are very pleased it has been possible with our colleagues at Armscor to identify really excellent local partners who not only delivered top quality, but have also been able to show their capabilities to the world through the DIP programme," Scheel added.

Armscor CEO Sipho Thomo said he is pleased to be able to certify the DIP obligations on the frigate platforms as being "essentially completed".

"Together with ThyssenKrupp Marine Systems, Armscor`s officials have ensured SA has benefited directly through the creation of jobs, transfer of technologies and skills coming out of the contract to re-equip the South African Navy with state-of-the-art stealth frigates," he said.

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