Russian-South African Defence and Technology Ties

Greg Mills and Sara Pienaar,

National Director and Research Fellow, SAIIA

Abstract

This paper examines the state of, and potential for, Russian-South African defence and technology ties within the historical context of bilateral relations and South Africa's recent arms purchases. It argues that there are three broad areas of potential cooperation, notably: the refurbishment of Russian aircraft in Africa; the purchase of civilian aircraft by African states; and a possible strategic defence production partnership. The paper concludes that there is clearly a need for Russian industry to connect with one or another, and to standardise its logistics and technology according to Western standards. The widespread prejudice against Russian products and negative perceptions about logistics and reliability may offer an exciting prospect. The South African industry is small enough not to want to dominate (or absorb) the Russian, but sufficiently technically proficient to hold its own. It also offers some parallels, having undergone a reconfiguration of its own since 1990. The question remains, however, whether South African industry is prepared to be (and capable of being) the champion of this Russian cause.

Introduction

In June 1999, Thabo Mbeki took office as South Africa's second democratically elected president. His election was widely interpreted at the time as a confirmation of South Africa's non-racial democracy, but it also marked a shift from Nelson Mandela's priority of racial and political reconciliation towards an emphasis on socio-economic progress.

Vladimir Putin succeeded Boris Yeltsin as president of the Russian Federation in May 2000. Even though he was Yeltsin's nominee, the election of the former KGB careerist is the first time in Russia's history that power has been transferred from one personality to another through the ballot box, thereby cementing Russia's post-Soviet democracy.

Both these new leaders face immense challenges of political consolidation and economic reform. Both also confront a difficult and, at times, threatening regional environment in which the economic imperative to restructure and downsize their armed forces must be weighed against the prospect of future conflict. Furthermore, both face a vastly altered global milieu, where their countries are now judged according to tough economic criteria rather than by their political ideologies as was the case in the past.

This article seeks to highlight two areas within the broader context of Russian-South African relations:

l First, the nature of relations between South Africa and Russia, especially in the defence sector.

l Second, an examination of past ties and future possibilities in terms of the supply of aviation technology and equipment, both civilian and military.

A Changing Political and Strategic Context

When assessing the prospects for contemporary Russian-South African relations, it is important to bear in mind their peculiar history. South Africa somewhat reluctantly accepted the USSR as an ally during World War II, when the Soviets opened consulates in Pretoria and Cape Town, but these were closed at Pretoria's insistence in 1956. The South African National Party (NP) government, in power from 1948-94, was fanatically hostile to what it understood as 'Communism' and to all countries which practised it.

During Africa's decolonisation era of the 1950s to 1970s, Moscow's support for liberation movements and its civilian and military aid to newly-independent governments were viewed by Pretoria as nothing more than Soviet neo-imperialism, especially after 1974 when Mozambique and Angola gained independence under Marxist governments and the liberation war in Rhodesia entered its final phase. For more than 15 years, South Africa fought bitter wars in Namibia and Angola and destabilised most of the rest of the region to counter what it saw as Soviet surrogates, meanwhile portraying itself as a bastion of Western anti-Communist values and interests. Pretoria always believed, or claimed to, that the USSR's ultimate aim in southern Africa was to install a puppet regime in South Africa which would, at Moscow's behest, close the Cape Sea Route to the West and hand over control of South Africa's mineral resources to the USSR, which would then impose a virtual world monopoly on various strategic and precious metals.

There was thus virtually no official contact for many decades and a great deal of hostile propaganda on both sides. Very little objective analysis of the USSR took place in South Africa, with the result that South Africans who grew up during this era still have little or no idea of what Russia is like. What they think they know is coloured by the propaganda of the past and by the rather negative reports about Russia they see nowadays on CNN and read in the Western media. Similarly, few Soviet citizens had much idea about South Africa other than what government propaganda told them, nor do most Russians today know much about it, though some powerful myths about its wealth and opportunities persist.

On the other hand, there were very close links indeed between the USSR and the African National Congress (ANC)/South African Communist Party (SACP) alliance, now in power in South Africa. Many of its leaders spent years in the USSR studying and training. Those who did not actually live there visited it frequently, to attend the Higher Party School and to hold discussions with Communist Party of the Soviet Union (CPSU) organs such as the Afro-Asian Solidarity Committee and with government and CPSU officials. The USSR was one of the Alliance's main financial supporters and just as importantly, it provided ideological leadership to the majority of ANC/SACP cadres who sincerely endorsed the Soviet world-view. In many cases, their experiences in the Soviet Union cannot have been entirely pleasant, but they remained extremely loyal.1

All this started to change after 1985 when Mikhail Gorbachev came to power culminating in the demise of the USSR in December 1991, when it fragmented into 15 independent states. Russia was clearly predominant in the former Soviet space and also inherited the state apparatus of the USSR, but it embarked on economic and political paths totally at odds with its predecessor.

The unexpected and cataclysmic changes in Russia occurred just as South Africa was equally unexpectedly emerging from its apartheid isolation. A period of negotiations in South Africa started in 1990 and concluded with the 1994 elections and the coming to power of the ANC/SACP/COSATU (Congress of South African Trade Unions) alliance. The simultaneous emergence of post-Communist Russia and of post-apartheid South Africa are not unrelated, however, and this has had an important bearing on the subsequent bilateral relationship. Indeed, the collapse of Communism in the Soviet Union was absolutely critical both in facilitating the Angolan-Namibian peace agreements in 1988/89 leading to the independence of Namibia in 1990, and in impelling the National Party government towards reform in South Africa. The removal of the claimed threat of a Communist take-over enabled State President F.W. de Klerk to sell the concept of a negotiated settlement with the ANC to white South Africans. As Adrian Guelke has argued,2 "It would be a mistake to attempt to explain De Klerk's actions in terms of a single factor. Nonetheless, the passage of time has done little to diminish the impression that the unexpected event of the breaching of the Berlin Wall played a significant role in the unexpected liberalisation of the South African political system."

Nonetheless, given the extent of Soviet aid to the ANC, Nelson Mandela announced soon after this release from jail in 1990 that he would visit the USSR on his very first trip overseas in order to thank Moscow for its support. In the event, he only set foot on Russian soil on his very last official tour as president in 1999. This nine-year delay was the result of a growing divergence between the Russian Federation government and the ANC/SACP. After the dissolution of the Soviet Union, Boris Yeltsin's Russia rapidly distanced itself from its links with the ANC and its allies. Instead, it started making overtures to South Africa's last National Party government, despite the fact that a majority government was quite clearly just around the corner in South Africa. After a year or more of negotiations, full diplomatic relations between Russia and South Africa were established in February 1992-more than two years before apartheid formally ended-and in the summer of that year, President De Klerk made a state visit to Russia. Both these developments deeply offended the ANC. In addition, they felt humiliated and undermined by Russia's wholesale abandonment of an ideology to which they had for the most part sincerely adhered. As a result, they saw their economic and social ideals derided, not only by the West, but also by their political rivals in South Africa.

Relations between the two countries, which had appeared so promising in the early 1990s, consequently languished after the ANC Alliance came to power. On at least five occasions between 1994 and 1998, a state visit to Russia by President Mandela was announced and then cancelled, usually for no plausible reason. This caused considerable offence in Russia, but accurately reflected the ambivalence with which the New Russia was viewed by the Mandela government.

Although diplomatic relations were maintained, government contacts were relatively infrequent and until recently, low-level. Ministerial visits did occur from both sides, but it was only when then Deputy President Mbeki and five Cabinet ministers went to Moscow in November 1998 that the official relationship began to acquire some substance. A number of framework agreements were signed on scientific and technical cooperation, sports and cultural contacts and on measures to combat organised crime across borders. President Mandela's state visit to Russia at the end of April 1999 achieved little of substance, but was of great symbolic importance and it now remains to be seen how the relationship between President Mbeki and President Putin will develop.

Bilateral trade has disappointed initial expectations, but the overall volume, which fell dramatically with the rouble's crash in August 1998, is once again on the rise, reaching about R760 million (roughly US$110 million) in 1999, with the balance very much in South Africa's favour, especially since many South African exports arrive in Russia via third countries and are, therefore, not reflected in this figure.

The chairman of the Duma's international affairs committee, Dmitri Rogozin, recently told the authors that "Russia could be an important partner for South Africa" and might "even consider special legislative measures" to open certain sectors of the Russian market to South Africa on favourable terms. In addition, he said, there were opportunities for cooperation in the mineral and banking sectors, and for joint production in the aviation and defence industries.3 Those South African brands established in Russia are doing well. South African Breweries' US$30 million 'Gold Barrel' brewery investment near Moscow is expanding its production and South African fruit, marketed by Capespan, is commonly seen. Russia also sells approximately US$1 billion worth of diamonds via De Beers' Central Selling Organisation annually, though this has been a troubled relationship and may not continue for long. Furthermore, the ongoing failure4 to operationalise either the bilateral Joint Trade and Economic Commission or the Science Commission must be addressed if a proper framework for further ties is to be developed.

To a great extent, progress in the Russian-South African relationship will hinge on what happens in Russia, and on whether President Putin can turn his country's economy around. Today, the once superpower Russia ranks 71st (South Africa is 101st) out of 174 countries on the UN's Human Development Index, which lists countries according to literacy, life expectancy, schooling, population growth, and per capita Gross Domestic Product (GDP). Between 1975 and 1995, Russia suffered an average 0.4 per cent economic decline every year. The average life expectancy of Russian men is, at 59, 14 years less than that of their Western counterparts-a reflection of poor living conditions and widespread alcoholism. There are signs, however, that Putin will make a determined attempt to tackle the issues that his predecessor was unable (or unwilling) to deal with.

Putin's greatest challenge is to strengthen the power of government at the expense of personalities and vested economic interests and, at the same time, to encourage economic growth and political pluralism. In this task, the new president faces a number of critical short-term difficulties, one of which is to manage Russia's US$170 billion foreign debt and avoid defaulting. This-and Russia's entire economic recovery-may hinge on the continued strength (or not) of global commodity prices. Second, Putin must establish the rule of law within a democratic context, something that Russia has never experienced; and third, he must deal with security problems within Russia, such as Chechnya along with others elsewhere in the Commonwealth of Independent States (CIS).

In his State of the Nation address to the Duma on July 8, 2000, Putin painted a grim picture of a Russia plagued by declining population, rising poverty and threatening political chaos. If current demographic trends continued, the population would decline from 146 million to 124 million by 2015. He committed himself to tackling his country's many problems through "accelerated market reforms, by strengthening the role of the executive at the expense of the powerful oligarchies and by reasserting Moscow's control over recalcitrant regional governors."

Putin apparently believes that "only an effective and democratic state is capable of protecting civic, political and economic freedoms".5 Despite criticism that his approach represents the "old Russian model of undivided authority and loyalty,"6 his economic priorities include the restoration of investor confidence through a number of measures, including the protection of property rights, curbing of government subsidies and privileges, reduction of red tape, easing of the tax burden and reduction of tariffs, rebuilding of the banking sector, and reform of the bloated and inefficient welfare system. There are already signs of economic recovery. The GDP rose 8.4 per cent in 1999, and is predicted to increase still more in 2000, at least in part because of the high oil prices.

Putin also wants Russia "to reclaim its Great, or even Superpower" place in the world. As he put it on July 8, "Russia's only real choice should be the choice of a strong country, strong and confident". While Putin's concept of "strength", appears to include a prosperous economy and a cohesive and law-abiding society, it also implies the need to rebuild the defence establishment. This was horribly battered by the failure of the Soviet intervention in Afghanistan in the 1980s, humiliated by its forced withdrawal from the former satellite states after 1989, and finally brought low by its dismal performance in Chechnya between 1994 and 1996. Downsizing, draft-dodging, scandals over unpaid wages and reported abuse and bullying in the ranks have all added to its woes.7 Some face has been restored at the cost of Western criticism by its relative success in the renewed onslaught on Chechen separatists since 1999, but that war still lingers on and no final victory can credibly be claimed. Reductions in defence spending every year between 1989 and 1999 mean that few if any orders for new equipment have reached the Russian military-industrial sector and this has led to the immense problems described later in this article. There are signs, however, that this situation is changing at last and in January 2000, the Russian government announced a 50 per cent increase in defence procurement. Furthermore, Russian arms exports have by no means ceased. They brought Russia US$3.5 billion of foreign earnings in 1999 and are expected to rise to US$4.3 billion in 2000, making Russia the world's fourth largest exporter of arms after the US (US$26.5 billion), France (US$9.8 billion) and the UK (US$9 billion) in a market whose total value is estimated to be US$56 billion.8

Recent Bilateral Defence Ties: Equipment and Agreements

Following the fall of the Berlin Wall and the dissolution of the Soviet Union, the old South African Defence Force (SADF)9 was not slow off the mark to establish contacts with its Russian and Ukrainian counterparts, although it was only on July 14, 1995, that South Africa's then Defence Minister Joe Modise and Russian Defence Minister Pavel Grachev signed a military-technical cooperation agreement. This included the prospect of arms sales, joint research, training and services, and the operation, repair and modernisation of armaments and military material.10

Prior to this agreement, the SADF had purchased the Juvent (later named the SAS Outeniqua) 21,000 tonne Arctic ice-capable supply-ship from Ukraine in 1993 for R41 million (then US$12 million), approximately one-third of the cost of building a similar vessel in South Africa.11 The ship is today seen as "useful" particularly given its roll-on-roll-off capabilities, although logistics problems have been encountered. These relate to difficulties in sourcing spares from around the old USSR as suppliers have gone into liquidation. Those attempting to procure spare parts have found that they could not pay the enterprise's bank, but have had to physically take the money to the supplier. There have also been problems with the precise identification of spares given the absence of Western-type systems and schedules.

The Mirage Re-Engine Scheme

Examples of both the South African Mirage F-1 and the Cheetah Fighters were re-engined with the MiG-29 Klimov RD33 (SMR-95) power-plant in 1994. The engine was fitted initially to a (ground-attack) Mirage F-1AZ and, following a successful trial flight, to an (interceptor) F-1CZ. This project was launched when the South African Air Force (SAAF) had no prospect of obtaining new fighters, following the cancellation of Project Carver (a twin-engine, South African-designed fighter) in the 1980s. It thus formed a part of more general upgrade of both aircraft. The intention was to enable the South Africans to contend with the MiG-23s that had been encountered in Angola, where the SAAF had found it difficult to manoeuvre into an attacking position from the rear due to a lack of power in the Mirage F-1s.

While it was intended as an interim solution, the SMR-95 project would have turned both the Cheetah and the Mirage F-1 into formidable aircraft, well able to bridge the gap to a new fighter. It would not, however, have avoided the need for a new fighter to replace both types from about 2015.

The SMR-95's power, fuel-economy and care-free throttle handling were reportedly very well received by the SAAF pilots. Fuel consumption was around 33 per cent lower, but this programme was considered to be unfeasible due to a number of reasons. These included expense, different philosophies of logistics and design/maintenance standards between the South Africans and the Russians,12 redesign complications including the need to 'straighten' the MiG-29 engine and relocate the gearbox, and only comparatively limited performance (15 per cent) improvements putting the Mirage F-1 on par with the Mirage 2000. The use of Russian specifications would have, in the opinion of SAAF specialists, necessitated the creation of two South African Air Forces, one Russian-based and the other Western, just as Libya, Malaysia, India and Germany have reportedly had to do. The Klimov engine was engineered to conduct 300 hours between overhauls. By comparison, the SAAF was acquiring between 1,200-2,000 hours for the O9K50 Mirage engine, and expected at least 600 hours from the Klimovs. Test-bed results apparently showed that this goal was difficult to achieve.

This project was terminated mainly because of South African defence cuts in the early 1990s. Once it became clear that the new government was willing to fund a new fighter programme, any thought of spending more money on the Mirages finally fell away in the middle of the decade. The possibility of reviving the project for the African Aerospace and Defence Show in Pretoria in 2000 was mooted, though it was unclear who would pay for the re-certification of the aircraft. Although South African industries were, by mid-2000, involved in upgrading F-1 avionics for at least two nations, it is believed that the benefits of such a programme would principally fall to the Klimov factory rather than to the South Africans.

The Defence Packages

In 1997, the Russian Federation Armament State Corporation Rosvoorouzhenie participated in the tender for various items required by the South African National Defence Force (SANDF). The items bid on and offered were: the Kilo 636 submarine; the MiG-29 fighter; the MiG-AT and Aermacchi/Yak-130 lead-in fighter trainer (LIFT) aircraft; and the T-80U tank.

The South African decision announced in September 1999 was made in two stages. First, the issuing of Request for Information (RFI); followed by a shortlist of potential suppliers who were then issued with Request for Proposals (RFP) based on three separate criteria: the technical/military specifications and functional abilities; the counter-trade13 aspects (the minimum expected was 100 per cent); and, the financing arrangements.

Ultimately, the South African decision was as follows:

Table 1. SA Defence Packages: The Agreed List, September 199914

Item Original Cabinet Decision Replacing

Tender

Submarines 4 3 (German Consortium) Daphnes

Corvettes 4 4(German Consortium) --

Light Fighters 38 9, options on 19 more Cheetahs

(SAAB/Bae, Gripen) (Mirages III upgrade)

Jet Trainers 24 12, plus options on Impalas (Aermacchis)

12 more (BAe, Hawk)

Light Utility Helicopters 60 30(Augusta A-109) Alouettes

Main Battle Tanks 95 0 Olifants (Centurions)

Maritime Helicopters 5/6 0 --

Russia and the Packages

Why Did the Russian Bids Fail?

None of the Russian packages, with the exception of the Aermacchi/YAK-130 fighter-trainer, got through to the short-list stage of an RFP. The reasons for this hinged around concerns about serviceability and technical suitability, though the Russian bids also did not offer any major cost savings. There were doubts, too, about supply and build quality (particularly of the submarines).

In terms of the naval bids, the size of the submarines was considered too large (at 3,000 tons, roughly three times the size of South Africa's existing Daphne class) which would have demanded changes to the South African Navy's (SAN) syncro-lifts and repair sheds. The Kilos also require a relatively large number of personnel (52 for Kilos as opposed to 30 for the selected Type-209s), and reportedly had also shown serious battery temperature problems in warm water. In the case of the submarine offer, the counter-trade aspects of the Russian offer was not a factor15 as the deliberations did not reach this stage.

In terms of the surface ships, the Russians did not respond to the 1997 RFI. However, in 1995, a SAN team visiting Russia had viewed the Gepard class corvette as a possibility for the requirement at that time-but at 1,932 tonnes and 102 metres in length this type was considered too small for South African waters and also did not operate a helicopter. These ships had apparently been constructed for export to India, but this order had been cancelled for undisclosed reasons. In 1995, the South African team had also been shown the technical specifications of the Krivak III class frigate, though this was a 'paper' ship only and while it was around the correct size required at 3,100 tonnes, had a complement (194) too large for the South African specification.16

The Kamov Ka-28 model was also informally investigated as a possibility for fulfilling the maritime helicopter requirement, though this was assessed as being similar to South Africa's existing Oryxs/Pumas-that is, intended for support rather than the required attack missions. There were also felt to be the same logistics/supply/maintenance problems highlighted above. The Ka-28's high centre of gravity made them, in the words of one senior naval officer, "Unsuitable for South African seas, and unsuitable for South Africa's type of ship" as they would be operating from what is still a relatively small vessel for South African waters.17 Their height would also have necessitated a high hangar structure. Furthermore, the Ka-28 was seen as having poor fuel efficiency, limiting task times.

The fighter-aircraft proposal was for MiG-29s. Again, like the submarines, these did not pass the initial RFI stage. Although it was assessed as having "good manoevrability", in the eyes of the SAAF, the MiG-29 had a number of critical drawbacks:

l First, it was a twin-engined aircraft, which exceeded the South African requirements due to its cost implications.

l Second, the Russians were not experienced at creating an in-country maintenance capability. Most customers send aircraft and engines back to the Russian Federation for repair and refurbishment.

l Third, the aircraft had a limited range and payload and the avionics were relatively dated. It also lacked the versatility of other contenders given the Russian focus on designing aircraft for specific (for example, ground-attack, interceptor) rather than for a variety of roles.

l Fourth, there were the same limitations on engine life and spares encountered with the Klimov Mirage re-engine scheme.

Similarly, aircraft such as the Su-27s were not considered due to the high life-cycle costs. These were "a totally different category of aircraft, way beyond South Africa's capability requirements and affordability."18

In terms of the LIFT, the MiG-AT did not impress as offering any real step forward from current technology. Moreover, it was seen as very expensive and had only flown as an aerial demonstrator, with the consequent high risk attached to its conversion into a production aircraft. This is a problem similar to that South Africa has faced itself with its Rooivalk attack helicopter which has now been put into production for the SANDF in the hope of acquiring foreign orders. The Aermacchi/Yak-130 offering was short-listed for the fighter-trainer (LIFT) along with the Czech L159, the Aermacchi MB339 and the UK Hawk, but was ultimately rejected on the basis of its cost and performance. The Hawk, for example, was assessed as possessing 18 per cent greater functional utility.

For the army, the T-80 tank was deemed to be essentially old technology. Russian tank systems were regarded as not having kept up with Western developments.

In summary, there are three main reasons why the Russians did not do well in tendering for South Africa's equipment requirements in 1998/99:

First, Pretoria's main focus was to win foreign investment for South Africa through counter-trade, not to re-equip the SANDF. The Russians were in no position to make any serious investment in South Africa, and neither did they have much in the way of new and immediately useful technology to transfer. The Aermacchi/YAK-130 deal, the only item short-listed, for example, apparently only offered a limited counter-trade deal.

Second, there was a strong imperative to ensure that the defence deals went to South Africa's major European trading partners-Germany, Britain, France and Italy. That was partly to cement country-to-country links and partly to show the US that South Africa did not need Washington. Russia had no role to play in either scenario. As it turned out, France did not get the intended major package (the tanks), but has since won the combat management system for the patrol corvettes, and is likely to be given another major project in due course. In the opinion of some, the Swedes got into the act by luck: the Gripen was the only new technology fighter that was affordable and it had the link with British Aerospace. Spain lost out on this round, but may win the order for new transport aircraft.19

In this regard, Pretoria wanted to position South Africa within what it perceives as the unfolding nature of a global defence industry divided into two emerging super-blocs-the Europeans and the United States. South Africa, they have argued, has more to gain by being a partial supplier to the Europeans than a complete systems manufacturer to niche market areas.

Third, Russian equipment has the reputation of being very difficult to support. Several countries using Russian equipment have reportedly suffered a range of problems when trying to obtain support and spares.

Future Prognosis: Reviewing the Review?

Russia's future ties with the South African defence sector thus depend to a great extent on South Africa's future requirements. In terms of the 1997 Defence Review, these are:

Table 2. SANDF Force Design: 1997 Defence Review (Option One)20

Personnel

Full-time Force (FTF) 22,000

Part-time Force (PTF) 69,400

SA Army

Mobile Division 1

Mechanised Brigade (RDF) 1

Parachute Brigade 1

Special Forces Brigade 1

Group HQ 27

Light Infantry Battalions 14

Territorial Motorised Infantry Battalions 12

Area Protection Units 183

SA Air Force

Light Fighters 16

Medium Fighters 32

Light Reconnaissance Aircraft 16

Medium Sigint Aircraft --

Long Range Maritime Patrol Aircraft 6

Medium Range Maritime Patrol Aircraft --

Short Range Maritime Patrol Aircraft 10

Remotely Piloted Squadrons 1

Combat Support Helicopters 12

Maritime Helicopters 5

Transport Helicopters 96

Transport Aircraft 44

VIP 9

Voluntary Squadrons 9

In-flight Refuelling/Electronic Warfare Aircraft 5

Radar Squadrons 3.5

Point Defence Squadrons --

Mobile Ground Sigint Team 3

SA Navy

Submarines 4

Corvettes 4

Strike Craft 6

Combat Support Ships 1

Minesweepers/Hunters 8

Inshore Patrol Vessels 2

Harbour Patrol 39

SA Medical Services

CB Defensive Programmes 1

Medical Battalion Groups (FTF) 1

Medical Battalion Groups (PTF) 1.5

The South African Air Force

The SAAF has a number of formal requirements in place, but its force design has been subjected to ongoing change. The most likely mix of near/medium term requirements is set out below, together with some clear needs that have not yet become requirements:

l Maritime Patrol Aircraft: These are needed to replace the unsuitable and inadequate turboprop Dakotas.21 This is currently seen as the third most important priority after the medium transport aircraft and short-range air-to-air missile. The need is for a mix of long-range and coastal types. The planning dates for the original mix of medium and long-range types were 2005 and 2008, though new aircraft will only be acquired by 2010. By mid-2000, it appeared most likely that a four-engined aircraft would be employed in this role, probably the three C-130s that were sourced from the US Navy, given the limitations on single-engine flying range over sea. The P-3 Orions offered by the US Navy are seen to be unsuitable due to the age of the avionics and high levels of stress and corrosion of the airframes. The Russian BE200 amphibious aircraft is seen as having possible applications in this regard given its "interesting collateral utility".

l Medium Transport Aircraft (50-seaters): There is a need to improve the type of aircraft that could provide STOL battlefield support such as the Transall C-160s or CASA-235s. There is a requirement for probably eight aircraft from 2003 onwards. The preferred types include the CASA C-235 or the FIAT/Lockheed C-27J, although the Antonov An-74 or An-140 are also possibilities. There is apparently little prospect of reinstating-as an interim measure-the nine C-160 SAAF Transalls retired in early 1990s.22 The cost of re-certification is estimated at US$5 million per aircraft for what is described by some officers as "an old lady", whereas a new aircraft will cost US$18 million. Moreover, the C-160 was designed for European rather than the "hot and high" conditions encountered in southern Africa. Even so, use of such aircraft (or the CASA C-235s) would open up an estimated further 200 airfields in southern Africa for operational usage when compared to the C-130s.

l Medium Heavy Transport Aircraft (90-seaters): The planned medium-heavy transport fleet of 12 C-130s is seen by some analysts as "clearly not adequate, despite current SAAF protestations" and "will have to be expanded to around 20/24 aircraft if the SAAF is to meet the demands that will arise from regional missions and commitments".23 However, the SAAF have pointed out that its fleet of nine operational C-130s (seven original aircraft, plus the five acquired from the US of which two are operational) are currently flying only 200 hours each per annum. The four-engine Antonov An-70X could be a contender if new aircraft were to be acquired, though there is a reluctance to split the aircraft types operating-and the An-70X remains also only a flying prototype.24 In reality, the ongoing SANDF funding shortage is unlikely to make this item an immediate procurement priority.

l Medium-Light Transport Aircraft: Probably 12 aircraft from 2002 onwards. The original requirement was for 20 to enter service between 2001 and 2008, though this is now unlikely to commence as soon as envisaged. The preferred type is apparently the CASA C-212.

l Communications/VIP Aircraft: The HS-125s have been discarded and need to be replaced by a similar type. No firm time-scale has been attached. There is also a requirement for a second presidential aircraft with inter-continental range, a decision that should be reached in 2000.

l Airborne Surveillance and ELINT: a replacement of the Boeing 707s will have to be sought within ten years, partly because of the high emission levels of the engines.

l Light Utility Aircraft: The original requirement was for some 24 aircraft to replace the Cessna-185. Although some Cessna 185s have been modernised, this requirement remains for 2002, given the need to upgrade sensors for effective border protection and police cooperation.

l New/Additional Fighters: The fighter force will, if found inadequate, be met by expanding the number of Gripens.

l Short-Range Infrared Air-to-Air Missile: This is a short-term requirement, where the cost per round is critical, as is the reliability of supply.

The South African Navy

The naval force for the foreseeable future will comprise: six strike-craft operational until 2010; four mine-sweepers; four mine-hunters; four corvettes/frigates; three submarines and two combat support vessels. There are thus no short term major requirements open, apart from the replacement of the Ton class mine-sweepers, but that could be met by acquiring, in 2000, four ex-German Navy Type-351 MCMVs (plus two spare vessels)25 albeit only as an interim solution. Looking to the longer term, there are a number of requirements, including:

l A replacement for the six Reshef/Warrior-class strike craft now being upgraded and due to retire from 2010. If funded, this would arguably be best met by extending the patrol corvette order to six to eight ships. This is the navy's preferred option.

l Mine-countermeasures vessels, to replace the four River-class and the four German Type-351 MCMVs. These are likely to be built locally to a Western navy design. This is unlikely to happen before 2015 or even 2020.

l There is a need for more than four patrol corvettes-six is the operationally practical minimum-and for a fourth submarine. But both will be met, if at all, by acquiring the same types as currently in hand or planned.

l In the longer term, the navy will need a second replenishment ship to complement the locally-built 12,500 tonne SAS Drakensberg and then ultimately a new ship to replace the Drakensberg.

l The navy also needs, but will not necessarily get, amphibious capability. If authorised, that requirement would be best met by a newly-built ship to one of several designs currently being offered by France, Singapore, Spain/Holland, Italy, Germany and the UK. This capability was offered to South Africa recently by the US government in the form of the 8,500 tonne Newport-class landing ship tank (LST), though this was considered by the SAN to be "steam technology" with associated maintenance and personnel problems.26

The South African Army

The intention for the future is to manufacture most army equipment locally and almost certainly to Western designs. The South African Army is about to begin a major "planned capital renewal programme" which follows the recently approved equipment programmes for the air force and navy.27 Defence Minister Mosiuoa Lekota argued in his 2000 budget speech that this would be a "primarily domestic acquisition programme". This will bring orders for South African-based companies including Denel, Vickers/Olifant Manufacturing Company (OMC), African Defence Systems (ADS) and the Grintek group, and many smaller companies. As Helmoed-Romer has noted, this will create considerable business potential for foreign companies whose equipment will be manufactured in South Africa, in the form of sub-systems and components, or as development partners.

Current planning envisages programmes running over a period of some 15 years, commencing from around the middle of this decade. Key elements will be some 95 new main battle tanks (MBTs), between 200-300 new infantry combat vehicles (ICVs) to replace the Ratel, more than 1,000 new mine-protected armoured personnel carriers (APCs) to replace the Buffel and Casspir, a man-portable air defence system (MANPADS) and a short-range air defence system (SHORADS), and several hundred tactical logistic vehicles. The army will also be acquiring ADS' AS-2000 artillery target engagement system, a new anti-tank missile, and an automatic 40 mm grenade launcher, as well as an upgrade of some existing systems. Other programmes, such as new tactical communications equipment, are already in the production stage.

In summary, the possible new acquisitions outside of the current packages include:

Table 3.

Item Possible Suppliers Horizon

Navy Two 10,000 tonne amphi- Civilian specification, 2005-2010

bious LPH-type helicopter and troop carriers.

Strike-craft replacement Two additional 2010 corvettes? Or local production?

Four MCMs Local construction; 2015-2020 German design?

4/5 Maritime Helicopters Lynx/Seasprite 2000

Air Force Maritime Patrol Aircraft 4-8 (C-130/BE200/P3?) 2010

Medium/Medium-Heavy 8-12 (CASA C-235/C-160/ 2003> Transport Aircraft C-130/An-74/C-27J/An-70?)

Medium-Light Transports 12 (CASA-212/?) 2001>

VIP Aircraft 2-5 2000>

Fighters 28+ Gripen 2008>

Light Utility Aircraft 24 2002>

IFR Missile local 2000>

ELINT 2 2010

Army MBTs 95 (Challenger, Le Clerc, 2003>

Leopard, Abrams)

ICVs 200-300 (8x9, Piranha, 2003> MRAV)

Tank Destroyers 72 to ICV hull, Kentron 2003>

Ingwe Missile System; interim solution fit Ingwe to Ratel?

APCs 1.000+ 2005>

Light Airborne Vehicle Pallet dropped 2001>

MANPADS Light SAM. One battery 2006> (12 launchers), later four batteries

SHORADS Kentron SAH3/Umkhonto. 2006> One regiment of four batteries

Logistics Vehicles 17-ton cross-country capable 2005>

Infantry Weapons Milan Replacement/Ingwe? 2005>

What is the potential for Russia meeting any of these requirements and, in the light of the above, the possibility of closer Russian-South African defence ties? In this regard, much clearly depends on what will happen to Russia's defence industry which, in turn, is related to wider political and geostrategic issues.

The State of Russia's Aviation Industry

Russia has today seven major aircraft manufacturers, involving 300 enterprises and organisations, including 133 in Research and Development (R&D) and testing, and 131 in producing commercial aircraft.28 Most of these are facing lean times. For example, since 1994, the Russian Ministry of Defence has not purchased a single MiG aircraft; and the Russian Air Force purchased no planes at all in 1998. Moreover, the market for its principal export, the MiG-29, has been declining steadily. This is the same company that developed 250 new types of aircraft over 60 years and manufactured more than 5,000 of all types. Similarly, the Sukhoi aircraft conglomerate has exported more than 2,000 aircraft types.29

Other difficulties exist. The pace of technical progress has slowed in a cost-cutting-or perhaps more accurately, cashless-environment. R&D budgets have dried up as the government removed subsidies after 1990. This has exacerbated the brain drain. Since 1991, an estimated 2,000 scientists and researchers have left the country annually. The Russian aviation industry has lost over 40 per cent of its scientific personnel. This is hardly surprising where the salaries average US$55 per month.30

Factories operate today at only a fraction of their capabilities, while, paradoxically, Russia's fleets are ageing. In 1996, for example, the industry produced only five aircraft of its capacity of 650. By 1998, 95 per cent of the Russian civilian fleet consisted of aircraft designed in the 1960s and 1970s.31

In summary, there are five major problems for the sector:

First, there has been a huge decrease in defence orders. The defence budget declined from 7.9 per cent of GDP in 1990 to 3.7 per cent in 1998. This has resulted in a reduction in the total number of defence industries from 1,800 in the mid-1990s to around 600 core industries today. Military industries have had to survive exclusively on export sales which totalled (in the defence sector), as already mentioned, US$3.5 billion in 1999, but, in the absence of an internal market, there are still not enough foreign buyers to sustain all of Russia's defence-related industries.

Second, Russian air carriers have reduced their orders from domestic suppliers due to both their own reorganisation and increased foreign penetration of the Russian market. The monopoly of Aeroflot was broken in 1990, and at present there are over 300 airlines registered in Russia and 200 in the other CIS countries, though the 15 largest handle around 75 per cent of the volume. Aeroflot's fleet now comprises 26 foreign-leased aircraft from a total of 125,32 but civilian orders are going to Western manufacturers, including Boeing and Airbus, partly due to problems of perception. For example, in July 2000, Hungary announced the impending retirement of its fleet of six Tupolev Tu-154s (similar to the Boeing 727 series) in April 2001. The airline's chief executive said: "They are good planes, they are safe planes, but they have become compromised in the eyes of the public."33

Third, related to the above point, there is the absence of a well-organised leasing system for civilian aircraft. According to the US Chamber of Commerce, "One of the most important impediments to the rebirth of the Russian aircraft industry is the lack of legislation and capital to allow aircraft financing in Russia. Until this problem is solved it will be more financially attractive for Russian airlines to obtain foreign aircraft under lease than to pay full purchase price to Russian manufacturers who have no access to the leasing system.34

Fourth, there has been considerable reduction of state investments in research and development.

Fifth, and finally, there has been very limited success in defence conversion, with many converted industries in dire straits.

All the above is indicative of the challenges that Russia (and its economy) has encountered in trying to reform its economy and integrate globally. The global role of the Russian aviation industry will to a large extent depend on what happens locally rather than vice versa. But there is some light at the end of the tunnel.

Four core production groups have emerged in the Russian aviation industry over the past five years, assisting in specialisation and possible access of the global market. These are:.35

l MiG-MAPO: Created in January 1996, uniting 14 enterprises, employing 60,000 people. Products include the MiG-family of aircraft and Kamov helicopters.

l Sukhoi Military Industrial Group: Created in August 1996, consisting of 32 enterprises and four R&D bureau. The main products include the Sukhoi line of fighters and Beriyev amphibians.

l Ilyushin Production Complex: Created in January 1997, it is the producer of most long-range Russian aircraft including the II-76 and II-96, and has also carried out design work for Boeing on the overhead baggage lockers for the Boeing 777 aircraft.

l ANTK Tupolev Production Group: Projects include work with Boeing and NASA to develop a supersonic passenger jet, and involvement on the Airbus A-3XX 'superjumbo' programme.

The MiG-29 SMT fly-by-wire fighter offers the promise of new export orders, as do the Tupolev TU-334 medium-haul civil airliner, the joint Ukrainian-Russian Antonov An-74 military transports, and the Beriyev BE-200 multipurpose (fire-fighting, transport and cargo) amphibian. These new aircraft complement the impressive standards set by workhorses such as the II-76 and Antonov An-124-100 transports. In 1988, it was estimated that there would be a requirement for between 1,000-1,200 new medium and long-haul aircraft in Russia alone by 2001.36

There is also a new generation of business leaders coming through the ranks, represented by people such as Sergei Nedoroslev, the head of the Kaskol high-tech holding group. He and others are working to shake off the image of unreliable, inflexible, Soviet stereotypes. Kaskol has a stake in the now privatised Sokol plant at Nizhny Novgorod which has produced the twin-seat MiG-29 and MiG-31 and which manufactured more than 15,000 aircraft during World War II, peaking at the rate of over 25 per day. It is once again beginning to find its feet in the radically altered defence environment. The Russian government has recently approved the export of the MiG-31, originally designed to intercept incoming cruise missiles. China may be the first customer.

Sokol has also embarked on a significant US$4 million per aircraft upgrade of the venerable MiG-21 for the Indian Air Force, including new avionics, generator and weapons systems. There are 1,400 of these planes in service around the globe, including many with African air forces to which Sokol is hoping to market this upgrade kit. This is not necessarily in the best interests of South Africa, however, which is geared towards the decreasing militarisation of inter-state relations on its continent. But it must be expected that an unstable Africa will remain an attractive market for Russia, Ukraine and others which possess large, relatively low-tech weapons stockpiles.37 In this way, the continued decline of the Russian arms industry may have significant consequences for Africa, given where this sector may increasingly be forced to sell, posing challenges for South African foreign policy with continued wars on the continent.

Nizhny Novgorod, was until recently, "closed" to Western visitors on account of the Sokol plant and the Lazurit Central Design Bureau, responsible for the radical titanium-hulled Sierra-class nuclear attack submarine. But the future for such industries does not lie exclusively in the defence sector. Without any aircraft orders from the Russian state since March 1994, Sokol has pinned its commercial hopes on a new light commuter plane, the turboprop M-101 Gzhel. This aircraft was to be certified during 2000, and will be marketed for around US$1.2 million, much cheaper than its Western competition.

Sokol has also to streamline its workforce by 7,000 from a peak of 30,000 and institute a conversion programme branching off into the manufacture of sea-going pleasure craft, trolley-buses, hydroplanes, kitchenware and even asphalt. These have not been easy times, especially since the plant has had to maintain its production capabilities as a government contingency, but without any financial support from the state.

Most importantly, Sokol, like other recently privatised corporations such as the Rosvertol Mi-26/35/28 helicopter plant in Rostov-on-Don, has had to develop a totally new, commercially-oriented mindset, where the customers (now external clients) come first. This means that reliability, cost-effectiveness and the market rather than the state dictate the path and price of production and development.

If its impressive technologies are to work for Russia, its industries will have to become part of the global aviation market. Here there has been some cooperation with Western suppliers, though this has been problematic in recent times for a number of reasons.38

l The North Atlantic Treaty Organisation (NATO) action against Yugoslavia has had a negative effect, particularly on cooperation with NATO partners.

l There are fears that Western companies are only interested in using Russian technology to expand the export of their own products to third countries-for example, utilising Russian armour on tanks.

l Related to the point above, there are fears that Western companies will use these technologies also for local production rather than for joint ventures in Russia.

l There are concerns of competition in third markets, sometimes by other Soviet states, but also by competitors such as Israel in the refurbishing of aircraft in Africa.

l There are suspicions about the application of Western conditionalities in joint ventures.

l There are problems of compatibility in standards and specifications.

l Western subsidies for exports, such as in the cases of US exports to Turkey and Greece make Russian prices unattractive.39

l Finally, in the civilian as in the military domain, it is very difficult for a Russian corporation whatever its technical and financial strengths, to compete against the domination of Boeing and Airbus.

In summary, the Russian aviation industry possesses a number of advantages.

First, there remain high levels of technical ingenuity and skill. For example, the Antonov An-74 and An-124-100 transports, Mi-26 heavy-lift, Mi-35 and Kamov Ka-52 'Alligator' combat helicopters are recognised as being among the best in their class in the world.

Second, there will be more joint ventures, both internationally and within the CIS. The Soviet Union's practice of spreading production across its republics means that today's Russia can only manufacture 18 per cent of its military requirements independently of other CIS members, notably Ukraine.40 The use of foreign technologies (particularly avionics and engines) with Russian airframes could assist in overcoming certification and logistics problems. The use of Pratt and Whitney, General Electric and Rolls Royce engines is increasingly commonplace, as is the installation of foreign avionics from firms such as Rockwell and, in the case of the Beriyev BE-200, Allied Signal. Foreign ventures with certification agencies, such as the French Bureau Veritas, could assist in bringing technologies up to Western standards.

Third, Russian aircraft are still competitive in a local civilian market in which there is a large demand for new aircraft at the rate of 100-300 per annum, although at the moment most airlines are unprofitable and cannot afford to modernise their fleets. In 1996, Russia had 8,203 registered civilian aircraft, including 2,847 passenger liners, 824 cargo planes and 2,476 helicopters.41

Ultimately, the strength of the Russian aviation industry will reflect the success, or lack of it, of attempts to rebuild the Russian economy and place it on a sound market footing. This is not easy in an uncertain economic environment with a fluctuating exchange rate, unstable fuel prices and low (though improving) global investor confidence. It remains a high-tech industry operating in a large domestic market and seeking at the same time to integrate with the global economy. This may offer opportunities to South Africa such as those set out below.

Conclusion: Into Africa?

There appears to be only a limited possibility that Russian equipment will be selected for any major future South African system requirement. The South African government is committed to linking with major Western powers in terms of defence cooperation and technology. Furthermore, there is a fear that further diversification of acquisition would produce far too many support and training problems. Thus, political, technological, technical (support) and military considerations all push South Africa strongly towards staying with Western equipment and expanding these links. There is apparently little that Russia can offer that could outweigh those considerations. With regard to the South African Army, the intention of the government is that its main equipment programmes should be handled as national programmes to benefit local industry as much as possible.

There might, however, be possibilities for the acquisition of transport aircraft such as the Antonov An-74 or An-140,42 perhaps through the leasing of Antonovs and/or the Beriyev BE-200 when (and if) the latter is certified. On the level of individual weapons or sub-systems, there may be potential for cooperation (as with the AA-11 infrared air-to-air missile reputedly acquired by the SAAF in the 1990s), particularly in the area of artillery rockets, intelligent shells and missiles of various types. Again, however, concerns about Russia's ability to sustain build-lines are critical, especially since South Africa will maintain only small stocks of key weapons such as missiles.

Such armaments procurements will have to pass through the tender procedure of the Procurement Secretariat in South Africa. Previous experience suggests that the Russian side will need to fulfil these requirements in both the technical and non-military (counter-trade) areas if they are to be serious contenders. In this regard, the Russians, it is felt by some in South Africa, will have to change from the "you bring all the money, we have all the expertise" attitude if they are to engage in real joint ventures with foreign partners.43

Sergei Nedoroslev contends that South Africa and Russia can offer each other advantages in this regard.44 Russia has a strong technology base and manufacturing ability, but Soviet isolation resulted in a shortage of personal contacts, unfamiliarity with the demands of global markets, and an uncooperative mindset. South Africa and Russia, he has argued, can now find synergy in these areas. There are three areas of potential cooperation:

The Refurbishment of Russian Aircraft in Africa: Sixteen sub-Saharan African countries out of a total of 48 operate Soviet military aircraft, of which at least eleven45 operate MiG-21 aircraft (or the Chinese J-7) or newer. In 1999, for example, Angola and Ethiopia each took delivery of Sukhoi Su-27s; and Eritrea acquired MiG-29s. This might offer possibilities for joint ventures in refurbishment. In 1999, Israel reportedly upgraded 50 MiG-21s and MiG-23s for Ethiopia. The question is moot, however, as to whether South Africa wants to support these countries in the upgrading of their air forces when their people are mired in poverty.

Purchase of Civilian Aircraft by African States: The Mil-17 and Mil-8 helicopters have certainly proved their worth, but to move from these to large commercial aircraft will be a major challenge. Apart from the attitudinal problem already referred to, no Russian civilian aircraft is at present being flown in the region and it may be almost impossible to break into a South African and regional market dominated by Boeing, Airbus and the North American and European manufacturers of smaller planes. Amongst the hurdles to be overcome will be concerns about the availability of spares and service along with public perceptions, however inaccurate, that any aircraft made in the former Soviet bloc is unsafe.

A Strategic Defence Production Partnership? As noted, current global defence trends suggest a world moving to two major blocs-the US and Europe. There is clearly a need for Russian industry to connect with one or another and to standardise its logistics and technology according to Western standards. Here, the widespread prejudice against Russian products and negative perception about logistics and reliability may offer an exciting prospect for joint ventures between Russian and South African enterprises. The South African industry is small enough not to want to dominate (or absorb) the Russian, but sufficiently technically proficient to hold its own. It also offers some parallels, having undergone a reconfiguration of its own since 1990. Today, the South African arms industry employs around half of its peak of 120,000 in the 1980s. A number of major South African defence producers have been bought out by Western-based companies.46 The question remains, however, whether South African industry is prepared to be (and capable of being) the champion of this Russian cause.

However, and as noted above, the path of the bilateral South African-Russian relationship will depend to a great extent on what happens in Russia under President Putin who appears committed to making Russia politically and economically strong once more. Military power and reform will be a critical part of this programme, despite the view expressed by Dmitri Trenin of the Moscow Carnegie Centre, "The lesson of the Soviet Union was that military power did not equal economic strength".47

Whatever the outcome, Russia today represents a reversal of many of the features of the Yeltsin era and displays convergence rather than divergence with Western political and economic norms. In this environment, Russian-South African relations are likely to improve, though they will never be of primary importance to either side. South African business is now cautiously optimistic about trade and investment with Russia, but the small number of delegates in the South Africa Foundation's business visit to Russia in June 2000 indicates that there are still substantial reservations, and despite some successful but relatively minor South African forays into the Russian market, the process of rebuilding faith and trust in Russia after the August 1998 rouble crash will clearly take some time. For defence ties to prosper, both governments will have to display an unprecedented level of political commitment if Russia's troubled but fast-changing defence industries are to seriously challenge South Africa's current suppliers.

NOTES

1. See Vladimir Shubin, ANC: A View from Moscow (Cape Town: Mayibuye Books, 1999) for a detailed exposition of the relationship from the Moscow side.

2. See Adrian Guelke, South Africa in Transition: The Misunderstood Miracle (London: IB Tauris, 1999) p. 42.

3. Interview, Russian State Duma, Moscow, July 12, 2000.

4. The Trade Commission was to be held in 1999, but had, by mid-2000, been postponed indefinitely by South Africa. The Science Commission has been postponed by the Russians until 2001.

5. See "Putin Address Details Nation's Woes", The Moscow Times, July 11, 2000. For details on the scale of Putin's economic challenges see "Fragile Russian Miracle", New Times, June 2000.

6. Liliya Shevtsova, Moscow Carnegie Centre cited in The Moscow Times, July 11, 2000.

7. For an excellent summary of the reasons behind the collapse of the Soviet military system, see William E. Odom, The Collapse of the Soviet Military (New Haven: Yale University Press, 1998)

8. The Economist, March 25, 2000.

9. Which became the South African National Defence Force (SANDF) after the first democratic elections in April 1994.

10. See "Tied up with Russia", Salut, September 1995, p. 10.

11. See "Lady of Reknown Bows to Ukrainian Ice-Breaker", Paratuc, April 1993.

12. As one SAAF officer put it: "The Russians fly their aircraft at the limit; and then they just throw the engine away".

13. The total cost of the equipment package is R21.3 billion over eight years. If the option to procure additional equipment is exercised, the total equipment cost will rise by R8.5 billion to R29.9 billion over 12 years. The options must be exercised by not later than the year 2004. The industrial participation projects linked to the purchase deals will reportedly yield significant economic benefits for South Africa, with total contracted commitments amounting to R104 billion, composed of: defence related offsets (about 20 per cent of the total, or R14.5 billion); counter-purchase by the defence equipment suppliers of South African goods (about 45 per cent or R31 billion); and foreign investment in South Africa by companies associated with the equipment suppliers (the remaining 35 per cent or R24 billion). For details of the packages, see <http://www.org.za/search/Default.asp>

14. Business Day, September 16, 1999.

15. For details on the Russian counter-trade offers, see "Presenting the MiG-AT", Salut, June 1998; and "Looking at the Rosvoorouzhenie Package Deal: An Opportunity to Modernise Extensively at a Very Low Cost," Salut, February 1998.

16. The Meko class corvette ultimately selected has a crew of less than 100. For details on the 1995 and 1997 deliberations see, respectively, Martin Edmonds and Greg Mills, Uncharted Waters: A Review of South Africa's Naval Options (Johannesburg: CDISS/SAIIA, 1995); and Martin Edmonds and Greg Mills, Beyond the Horizon: Defence, Diplomacy and South Africa's Maritime Opportunities. (Johannesburg: CDISS/SAIIA, 1998).

17. Interview, SA Navy HQ, Pretoria, July 2000.

18. Interview, SA Air Force, Pretoria, July 2000.

19. The Spanish firm CASA offered eight C-235s and eight C-212s in 1998 for US$200 million, with a buy-back offer on the SAAF's existing four C-212s and single C-235.

20. Accepted August 1997. Fighter, helicopter and transport numbers do not include aircraft at flying schools. The long range maritime patrol aircraft will, for reasons of cost, not be equipped with full surface and sub-surface weapons systems, although they will be fitted to accommodate such systems.

21. The Dakota TPs not only have a limited range, but the aircraft have two other major failings: first, they apparently leak, with negative consequences for the equipment carried; second, they cannot carry the surveillance system developed for them in the 1990s. There are also reportedly problems with the airframes cracking. By August 2000, only one of 11 Dakota TPs was configured for maritime patrol, and was undergoing technical evaluations. An additional four aircraft are to be similarly equipped and made ready for service by March/April 2001. The remainder will be used for transport purposes or held in reserve.

22. In the opinion of many, the retirement of the C-160s was a "tragic miscalculation" given both South Africa's current requirements and the C-160's capabilities (short take-off, and the ability to ferry an Oryx without, unlike the C-130s having to remove the rotor head), but also because of the manner in which this occurred. These aircraft were retired on the basis of an internal SA Air Force audit conducted in the early 1990s. The common denominator in determining which aircraft types were to be retired was lifecycle cost. Two C-160s had been landed 'wheels up', and the repair costs were included in the standard scheduled maintenance cost, with all the negative implications. This was only discovered after the aircraft were withdrawn from service. The airframes have apparently only relatively low hours and the previous problem of the acquisition of spares encountered during the apartheid (sanction) years is no longer an issue. There have been at least two attempts to bring the C-160s back into service, once as a maritime patrol aircraft. The aircraft are currently out to tender. Interviews, current and past SAAF officers, July 2000.

23. Discussion, Helmoed-Romer Heitman, April 2000.

24. For information on the types of transport aircraft available globally, see Jane's Defence Weekly, February 16, 2000.

25. At an estimated cost of only US$150,000 each.

26. Interview, SAN HQ, July 2000.

27. See Helmoed-Romer Heitman, "South African Army Re-Equipment", Jane's Defence Weekly, May 3, 2000.

28. See "Russia's Premier Planemakers Ready for Take off", Global Defence Review 2000.

29. Markets include: India, China, Iraq, Poland, Czech Republic, Slovakia, Hungary, Germany, Syria, Algeria, North Korea, Vietnam, Afghanistan, Yemen, Egypt, Libya, Iran, Angola, Ethiopia, and Peru.

30. See Gordon Feller, "Leveraging the Base", on <http://www.rotor.com > It is often not the size of the salaries, but whether they are paid regularly that is used as the determinant of the health of many companies in Russia. Factories are often proud to inform visitors that their staff "are paid monthly".

31. See "Aviation Industry: Russia", US Foreign and Commercial Service Report, 1998 on <http://www/readeport.org.>

32. See "Red Dawn: Current State of Russia's Aviation Industry", on <http://www.innov.ru/engligh/news/airinidustry.htm.>

33. See The Moscow Times, July 14, 2000.

34. n. 32.

35. For details on the composition of these groups, see Ibid.

36. Ibid.

37. A recent edition of a Ukrainian defence-related journal has argued, "Demand for outdated hardware from the stockpiles is falling. For this reason, Ukraine does not take part in a number of promising tenders, such as the rearmament of the Republic of South Africa". It went on, "The Central African markets look attractive for Ukraine for a number of reasons. In the first place, their consumption of weapons systems and equipment decommissioned from the armed forces of Ukraine is comparatively smooth. Secondly, the Central African region is traditionally an area of armed opposition, so, arms trade is on the rise to the south of Sahara. In 1998, it increased almost two-fold 3/4 from US$991 million to US$1.69 billion. The expectation of conflict makes customers less demanding in their choice of arms suppliers. Thirdly, most Central African countries do not have developed industries, that is why they prefer buying arms, rather than licences. Finally, this region employs even more Soviet-made weapons systems than the Middle East. At the same time, this circumstance causes competition amongst post-Soviet arms exporters to be especially strong." It also noted importantly, "In contrast to the leading Western manufacturers of weapons systems, Ukraine lays down no political conditions for potential customers, which gives it an advantage over other exporters." See Valentyn Vadrak, "Ukraine on the World Arms Market", National Security and Defence, June, 2000, pp. 60-4.

38. See the sections on France and Israel in "The True Spirit of Co-operation", Global Defence Review 2000, pp. 203-4.

39. This may account for the Turkish decision in July 2000 to choose the US Bell-Textron AH-1Z King Cobra over the Israeli-Russian Kamov Ka-50/2 Erdogan bid as the preferred supplier for a US$4.5 billion army requirement for 145 attack helicopters. See "Why did Bell win the Helicopter Tender?", Turkish Daily News, July 24, 2000.

. 40. See Gordon Feller, "Adjusting to a Turbulent Market", on <http://www.rotor.com.>

41. See n. 32.

42. The comparatively low cost (around US$11 million per aircraft) of the Antonov An-74 medium transport makes it an attractive option. There are more than 200 of these versatile STOL aircraft in service world-wide, which are capable of carrying a ten tonne payload and operating from ice, grass and gravel runways. The new Antonov An-140 52-seater twin-engine passenger and cargo aircraft also offers other possibilities.

43. Interview, Armscor, July 2000. This view was reflected by a number of South Africans interviewed.

44. Interview, Moscow, July 12, 2000.

45. Angola, Republic of Congo (Brazzaville), Eritrea, Ethiopia, Madagascar, Mozambique, Nigeria, Sudan, Tanzania, Zambia and Zimbabwe. See The Military Balance (Oxford: OUP/IISS, 1999).

46. As of August 2000, the companies which have been bought out are: OMC by Vickers, Paradigm Systems Technology partly by Bae Systems, ADS by Thomson SA, Advanced Technologies and Engineering (ATE) partly by Bae Systems, Grintek Aviatronics partly by Celsius Technology of Sweden, and the European Aeronautic Defence and Space Company (EADS) has a share in Reutech Radar Systems. The privatisation of Denel, which accounts for roughly half of defence production in South Africa, was announced in August 2000. This is planned to occur along with the sale of other 'Big Four' South African parastatals-Eskom (electricity supply), Telkom (telecommunications) and Transnet (railways and harbours)-by 2004. Denel, ATE, Grintek, ADS and Reutech are considered to be the 'Big Five' of the South African arms industry.

47. Interview, Moscow, July 14, 2000.