Publication: Business Day Issued: Date: 2003-11-06 Reporter: Richard Young

New Corvettes are Less for More


Business Day

Date 2003-11-06


Richard Young

Web Link


Sir - The article, Negotiating Waves of Change in SA's Two Navies (October 15), and interview with the chief of the South African Navy, Vice-Admiral Johan Retief, refers.

On the combat suite for the corvettes - which has been at the centre of allegations of corruption in the arms deal, specifically those regarding Shaik brothers Schabir and Chippy.

Deputy President Jacob Zuma and French defence company Thales - Retief reportedly had this "quick" reply : "We are getting more than we bargained for."

This is patent nonsense. More what? It certainly wasn't combat capability.

Soon after the "bargaining" started in December 1998, the department of defence and Armscor wrote a telling memorandum wherein they stated that the corvette combat suite contract could "not be negotiated at two different levels in parallel".

By March 1999 Armscor was getting seriously concerned about the "bargaining". In the minutes of a maritime projects meeting they record : "The corvette program currently running into some difficulties, specifically with regard to the combat system. The current cost is not being realised."

By March 31 1999 the "wheels had completely fallen off" the negotiating process, causing the chief of the navy to send a letter to the German Frigate Consortium and the SA Corvette Combat Suite Group headed by ADS and Thales.

The second paragraph tells the story : "You are reminded that these measures represent a considerable departure from the functionality required in the South African Navy corvette combat suite requirement specification, and have been necessitated by the untenable price of the local combat suite offered in February 1999, the latter having been double the price offered by the South African industry in May-August 1998, for essentially the same baseline."

At the end of the day the corvettes are being fitted with half the anti-ship missiles, half the anti-air missiles, half the electronic warfare countermeasures, half the tracking radars, limited sonar, no torpedoes or torpedo countermeasures, as well as an antiquated and nonconformant system architecture.

This is all at a price much higher than budgeted and after getting the auditing a price from the local industry.

It is estimated that SA's taxpayers paid about 45% more for about 40% less. So much for this bargain.

The only bargain in this matter may be the one known to Zuma, Thales and the brothers Shaik.

Richard Young
MD, CI Systems

With acknowledgements to Richard Young and Business Day.