MONDAY, 1.00PM:
THE 35-year-old United States embargo on arms trade with South Africa has been ended by an agreement between South African Deputy President Thabo Mbeki and US Vice-President Al Gore.
The embargo opens the door to SA’s purchase of the JAS 39 Gripen jet fighter manufactured by Swedish company Saab and British Aeropace. Any possible sale was stymied by the US last month, as a third of the plane’s components are US-manufactured.
The statement from Gore and Mbeki follows the findings of a US audit team of arms experts, who spent seven days visiting South Africa last month and concluded that local arms firms are complying with US trade regulations.
Although the United Nations arms embargo on South Africa, which began in 1963, was lifted in 1994 on the election of South Africa’s first democratic government, the US embargo remained in place, as a penalty imposed on SA companies that had been involved in smuggling military equipment from a US manufacturer from 1978 to 1989. Last year, Armscor, Kentron and Fuchs Electronics reached a settlement in the US, agreeing to pay fines totaling $12,5-million.
Arms procurement agency Armscor, shadowing the slimming-down of the SA National Defence Force and defence manufacturer Denel, is planning significant retrenchments. The lay-offs are intended to increase organisational efficiency, despite the expectation that the defence force’s 13% capital expenses budget will expand to 30%. The company will also be involved in the imminent purchase of R12-billion of corvettes, submarines, helicopters, aircraft and tanks for the SANDF.
It is not certain how many of Armscor’s 1000 staff will be affected, but the process has begun with the decision not to renew contract staff and imminent consultation with employees over 55.