President Cyril Ramaphosa opened the 10th African Aerospace and Defence (AAD 2018) show at AFB Waterkloof today with hints that an alternative defence funding model to help support a contrained military budget is in the offing.
He praised the defence industry as a “national asset” that meant SA did not have to rely on other countries for defence products, although it is open to joint ventures.
“Unlike many international ventures, defence production in South Africa does not imply multinational inter-dependency,” he said.
“South Africa combines a top order rating for ease of doing business with the most sophisticated and largest manufacturing sector on the continent.
“In terms of intellectual property, South Africa is one of less than ten countries that can manufacture missiles of a certain level of sophistication,” he said.
On the funding model to make the military less reliant on the fiscus, he said:”Several ideas are being explored to modernise the funding model of defence and reduce its dependency on the fiscus,” with no elaboration.
“The leveraging of the economic value of many types of assets of the defence force is under development, alongside improvements in the efficiency of the defence force and the rejuvenation of the defence human resources component,” he added.
Rampahosa indicated the defence budget would continue to be contrained. The “means available in the fiscus are finite” and SA National Defence Force (SANDF) acknowledged “this economic reality”, he said.
The “leveraging of economic value” could refer to sales or leases of land or facilities owned by the defence force.
This year’s exhibition draws delegates from more than a hundred countries, and 500 exhibitors from more than 30 countries. The US continues to show a large presence with a display that includes a C-17 military transporter. But China and Russia have a new enlarged presence with sizeable stands for their leading defence companies.
The President restated existing policy that SA views the role of its military as a “developmental force” that would continue to undertake peace missions on the continent. The President also restated the existing policy that SA forces involved in African interventions would fall “under direct control of the African Union.”
As a still relatively new President, this might well have been aimed reassuring African countries of policy continuity.
In other remarks at the opening, the President emphasised the Defence Force’s enlarged role of border safeguarding and internal security.
“Data must be collected at border posts and from defence related surveillance technology to allow governments to define and manage trends,” he said.
“In terms of internal security, the defence force must always be ready to provide additional capacity to maintain order and stability within the relevant governance framework,” the President said.
Ramaphosa was effusive in his praise for the local defence industry as innovative, an incubator of scarce skills, and a significant exporter. He said the SA defence industry provided 15,000 direct jobs in 120 companies, and exported to 88 countries.
“It innovates products for the greater economy, such as systems that improve the safety of railway lines or improve the efficiency of shark nets,” he said.
“The industry is a steady earner of foreign exchange by delivering to the world leading products such as the Husky vehicle for detecting improvised explosive devices,”
While he mentioned that the Department of Trade and Industry is in the process of finalising the Defence Charter, which will regulate broad based black economic empowerment, he gave no details of the final version.