Minister of Defence and Military Veterans, Hon Nosiviwe Mapisa-Nqakula speaking notes on the occasion of the 2018 AMD Conference: 18 Sep 2018. Southern Sun, Arcadia - Tshwane
Secretary for Defence, Dr Sam Gulube;
Chief of the SANDF, Gen Solly Shoke;
Members of the PDSC, the National Defence Industry Council and other key decision making bodies here present;
Board members from various role players and stakeholders like Armscor, Denel and AMD;
Members of the diplomatic corps and the Military Attache Advisory Community, MAAC;
Our guests who have visited SA to attend both this conference and the AAD;
Speakers, panellists, participants, members of the media, ladies and gentlemen,
Allow me to commence this address by asserting – as you’d all agree – that the SA Defence Industry is at a critical cross roads due to the many challenges that have been visited upon it which include but are not limited to the following:
- The declining SA Defence Budget and consequently reduced spending on the acquisition of defence capital acquisition needs as well as reduced spend on R&D as a critical enabler for future capabilities and competitiveness.
- Increased competition even from partner nations resulting in reduced market access and erosion of capabilities as some of our engineers migrate to serve the defence industrial aspirations of other nations. This is inclusive of emerging defence industrial nations in the Middle East and South East Asia all of whom will soon be direct competitors with the SADI.
- Various intra-SADI challenges inclusive of the crisis as manifested in Denel as well as the various entities that are in business rescue and are contemplating various measures to ensure their future survival.
- Lack of comprehensive and genuine transformation as well as constrained access to funding to enable the fulfilment of contracts as awarded.
All of the above challenges will not be made easier by the recent announcement that the country has entered into a technical recession. Whilst one could mention a few other challenges I am certain the above are sufficient to adequately paint the picture and to portray the need for us to ensure that we all recommit ourselves to engaging with the industry in an effort to find meaningful and impactful methods of intervening where necessary as well as supporting where required.
Mindful of the above challenges we are then compelled to acknowledge that it cannot be business as usual. The industry has to transform. The industry has to perform against contracts both locally and abroad. There are no entitlements to any capability areas of contracts regardless of your standing as a systems house or degree of state ownership. We have to better manage our resources and process to optimally ensure localisation, industrialisation and retention of capabilities within the SADI as well as to get full government support for SADI exports.
As Minister I have commenced this process of repositioning the SADI by mandating the establishment of NDIC whose structure is currently being costed so that funds can be sourced so that it can operationalised. Emanating from the work of NDIC, you will be aware that we have completed the compilation of the SA Defence Industry Strategy and are now finalising its Implementation Plan which will be adopted before the end of this year with implementation to commence soon thereafter.
In addition to the above, Armscor and AMD have overseen the development of a SADI BBBEE Charter as well as the creation of the SA Defence Industry Fund both of which are at final stages towards being either gazetted. Finally, you will recall that in July this year, we announced the creation of the SA Defence Industry Fund which will allow our industry access to funding with the primary aim of ensuring transformation, competitiveness and sustainability.
The above however is not and will never be enough and I am calling upon you as part of today’s engagement to highlight some of the measures that you believe we need to consider adopting in an effort to optimally support you as an industry.
As a start, I wish to reassure you that we are aware of the key contribution that is made by exports in ensuring the continued existence of the SADI. To this end, my department and I remain committed to providing you with the necessary political support in all your future export endeavours. In fact I must highlight that it becomes my mission to market our defence industry, together with the Chief SANDF, Service and Division Chiefs and generally SANDF personnel. The downside however happens when there is no follow-through from yourselves as the SADI on the bilateral engagements I would have undertaken and committed to, thus leaving us with egg on our face.
That notwithstanding, we will also continue work with you in engaging other relevant departments to ensure that we have a “government wide” approach to providing this support and I believe NDIC can play a key role in this regards. It is thus no surprise that the composition of the NDIC is configured in the manner that it is…multi departmental and stakeholder driven.
Associated with this is the need for us to improve the performance and efficacy of the arms control authorities to ensure that your interaction with them is not characterised by undue delays and inexplicable administrative lapses that compromise your ability to competitively export from SA.
With the above said, allow me not to very briefly address you with regards to this conference and its desired outcomes based on the theme that has been chosen for this year being “Africa Rising – Supporting Peacekeeping and Defence Technologies in Africa”. South Africa has a very proud heritage both militarily as well as from a technology point of view. The presentations and discussions you will have today will both support this and enable us to start thinking of how best to advance this heritage whilst positioning ourselves for the future.
As a country, we have always punched above our weight and this is evident in the fact that despite our limited resources and the various constraints we are faced with, we continue to be pioneers in various areas and additive manufacturing is several areas. As a country we are well positioned to play this role as most of the metals like titanium are readily available whilst we have already invested in leading research that has resulted in the AeroSwift machine on which you will hear more about later today.
I thank you and wish you all of the best in your deliberations today.
