Home / REGIONS / Africa / Militaries around the world benefit from industrial localization: A global trend

Militaries around the world benefit from industrial localization: A global trend

Print Friendly, PDF & Email

Amy Sherif

A trend is now globally solidifying, whereby many countries are set on a strategic approach to becoming more self-reliant in development, production and support of military assets.

These capabilities were usually exclusively provided by advanced industrial capabilities such as the United States, Russia, France, United Kingdom which historically have delivered the majority of the world’s military equipment, whether for air, land or naval forces.

Over the last two decades, nations around the world have increased investments in developing local capabilities and technology. These investments have sometimes taken the form of R&D initiatives using local resources, or more frequently leveraging technologies and knowledge acquired from leading global defense companies willing to transfer their products, technology, and intellectual property (IP). As evidence of the success of the latter model, many businesses in emerging markets can now compete and win production contracts on a level field with the original equipment manufacturers.

Exports from nations such as Poland and South Africa have expanded substantially. These nations can now provide technology across multiple domains, ranging from weaponry to electronics and cybersecurity. In contrast, many Middle Eastern countries that continue to rely heavily on imported military equipment. Saudi Arabia, the United Arab Emirates (UAE), and Egypt have focused their resources to establish robust local military manufacturing industries.

Swiftships is partnering with Egypt to produce ships locally for the Egyptian Navy. Swiftships was selected by Egypt after a long, arduous search for a vendor with proven technology that was releasable, and that was willing to invest in local economies. Swiftships, which is based in the United States, specializes in international co-production programs that help U.S.-allied governments grow their own industries, create jobs, and transfer technology and knowledge to their national economies for long-term economic advantage.

With the announcement in 2010 of the Vision 2021 project,  Sheikh Mohammed bin Rashid Al Maktoum launched the UAE into the global competitive knowledge economy, while at the same time building up this nation’s military strength. Today, EDGE Group is a conglomeration of entities capable of supporting planes, tanks, and manufacturing armaments of sufficient quality and quantity to compete globally.

Crown Prince Mohammed bin Salman (MBS) released Saudi Arabia’s Vision 2030 in 2017, setting a goal of purchasing at least 50 percent of the Kingdom’s military spending from local suppliers by 2030. Although these goals are ambitious, they remain within reach. Building a local industrial base while creating jobs and local capabilities can be achieved by utilizing already developed technologies, acquiring expertise, while localizing capabilities and manufacturing.

A successful industrial localization strategy begins with identifying partner countries or companies willing to release and transfer the said technologies. Unlike commercial agreements, such deals are generally driven by strategic political alliances, and require government involvement. For example, in 2018, Saudi Arabia Military Industries (SAMI) and its holding company, the Public Investment Fund (PIF) negotiated an agreement with South Africa’s Denel company to acquire significant portions of Denel’ Intellectual Property for Military equipment. After long negotiations, the deal was not consummated because the South African Government did not wish to divest its primary defense sector. SAMI is now working with other countries to identify capabilities, ripe for transfer to Saudi, with focus on Design, production and sustainment of military assets.

Swiftships’ initial success story in the Middle East and Asia began with two major programs in Egypt and Pakistan, and was advanced with further initiatives in Saudi Arabia. Swiftships is co-producing twenty-six 28 meter Combat Patrol Crafts for the Egyptian Navy at the Egyptian Shipyard under the aegis of the United States Navy’s High-Speed Naval Craft guidelines. Egypt has also contracted Swiftships to co-produce sixteen 28 meter Combat Patrol Crafts by 2023, with options/total requirements of up to fifty craft.

In 2021, the Pakistan Navy awarded a 38-meter gunboat design, engineering, and building contract to Swiftships. The contract options include supply kitting and supervision of build at Karachi Shipyard and Engineering Works for up to twenty 38-meter gunboats, which will be manufactured locally in Karachi. The agreement offers the Pakistan Navy a complete Kit of Material and oversight and support for design, engineering, and training for Pakistan engineers, builders, and operators. Swiftships will also assist with production QA, QC, and ILS.

To support Saudi Arabia, Swiftships has established a Saudi-based joint venture with Saffan to directly support the Tuwaiq class Multi-Mission Surface Combatants in partnership with Lockheed Martin Corporation. Under the guidance of Swiftships, the Saudi Navy along with the United States Navy, Lockheed Martin, and Saffan are planning yard and processing acquisition tasks with the support of GAMI and local authorities. Upon completion, Saudi Arabia will be able to indigenously build and sustain ship maintenance infrastructure and skills for all of the Kingdom’s different classes of ships, which will provide a substantial benefit to the Saudi economy.