A defence industry is an integral part of any country's defence capability, the writer argues. Picture: SUPPLIED
Today that industry is dying for lack of government support: the defence budget is too tight to allow the defence force to acquire new equipment and upgrade or properly maintain what it has in service, let alone fund research & development. And, unlike other countries with a defence industry, the government has failed to strongly support exports. Worse, state-owned defence group Denel became entangled in state capture; its finances imploded and its performance suffered.
From the industrial perspective it brings new technologies, skills and processes that spin off to other sectors, and educates and trains engineers and artisans who migrate to other sectors. Gunnar Eliasson of the department of industrial economics of the Royal Institute of Technology in Stockholm argued that the effect of investment in the defence industry will be highest in countries with some high-technology capability and some level of unemployment, which sounds rather like SA.The Rooivalk project is interesting in this context. Developing the Rooivalk and producing 12 aircraft cost just under R9bn .
We should look to sell whatever Denel intellectual property we can — there is some really good IP — and then we would have to leave the private companies to sink or swim. We will have to accept losing strategic independence, optimised equipment, export revenues, technology development and jobs, and accept that we will have to pay substantial amounts for imported equipment and its through-life support.