Swedish aerospace and defence group Saab reported on Sunday that it had fulfilled all its offset obligations with South Africa regarding the latter's acquisition of 26 Gripen fighters.
Officially designated industrial participation, these offsets were divided into two categories – defence industrial participation (Dip) and national industrial participation (Nip). Dip was focused on the defence industry and Nip on civilian sectors.
"It's been confirmed that we've met our obligations on both sides. All Dip is now done, obligations discharged. All Nip is also now fully discharged," stated Saab head of Gripen export business Eddy de la Motte.
"I believe that we exceeded our Dip and Nip obligations a bit."
The Gripens were acquired along with 24 BAE Systems Hawk fighter-trainers in a single deal worth $2.2-billion. The two companies had a joint Dip obligation of $1.5-billion and a joint Nip obligation of $8.7-billion.
Oversight of Dip was vested in South African defence acquisition and research and development agency Armscor, which had to approve all Dip projects. All Dip claims were documented in detail and Dip credits were awarded by Armscor.
Dip programmes have included the manufacture in South Africa of Gripen main landing gear units and rear fuselages; the design engineering, rapid prototyping and certification of North Atlantic Treaty Organisation-standard pylons for the Gripen; the purchase of South African health and usage monitoring systems for Swedish Air Force helicopters, the South African-developed audio control unit for the Gripen, and the adoption of the South African helmet sight tracker system for the Gripen and Eurofighter Typhoon.
To execute their Nip obligations, the two companies set up a joint venture, Sanip. The Department of Trade and Industry oversaw Nip. All Nip claims had to be documented in a paper trail that could be completely audited.
Nip involved Sanip bringing $8.7-billion worth of economic benefits to South Africa. Examples of beneficiaries of Nip include Dunlop tyres (Durban and Ladysmith), Silplat platinum jewellery (Cape Town), Global Forest Projects (now York Timber), ABB (exporting South African-manufactured power station components to the US) and Atlas Copco (the manufacture of heavy mining equipment for export).
"Over 1 000 potential Nip and Dip projects were received and considered. More than 150 projects were implemented from April 2000. Over 75 South African companies partnered with Saab and BAE Systems on Nip and Dip projects. Based on our experience on Dip and Nip, Saab acquired Grintek and established Saab South Africa," De la Motte said.
Keith Campbell is in Sweden as a guest of the Saab group.