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Algeria Tops Africa Markets; Arms Race Emerges on Continent
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Algeria Tops Africa Markets; Arms Race Emerges on Continent
Oct. 20, 2013 - 12:04PM | By OSCAR NKALA
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Insurgent Threats: Tunisian soldiers stand guard near a demolished vehicle following a roadside bombing near the Algerian border. North African countries are spending considerably on counterinsurgency capabilities. (Agence France-Presse)
BULAWAYO, ZIMBABWE — Algeria will remain Africa’s top defense market as it spends on counterterrorism and counterinsurgency capabilities, but tries to keep pace with an ongoing North African arms race, according to a report by the Strategic Defense Intelligence (SDI) market research group.
The forecast, which sees North Africa growing into one of the world’s biggest defense markets by 2017, comes as sub-Saharan African big-spenders South Africa, Kenya, Uganda and Nigeria acquire new armored vehicles and upgrade existing weapons to match the changing demands of ground warfare.
According to the report, “The Future of the Algerian Defense Industry — Market Attractiveness, Competitive Landscape and Forecasts to 2017,” defense spending will maintain a steady growth rate of 6.2 percent annually up to 2017 as it shifts from a war footing to one driven only by force modernization requirements.
“Despite its challenges, Algeria remains one of Africa’s most attractive defense markets, with a defense spending capability that is expected to increase in the forecast period, primarily owing to increased energy exports and an arms race in the North African region,” the report states. “The country’s defense spending, which increased at a significant rate of 21.4% during the review period, is expected to stabilize during the forecast period, growing at a steady rate of 6.2% with the main aim of replacing most of its outdated military equipment.
“Furthermore, the opening up of Algeria’s market to suppliers other than those in Russia is expected to make it an exciting proposition for foreign companies looking to enter the market.”
Among the key drivers behind the arms buying spree is the need to acquire and upgrade land warfare systems to meet the demands of counterterror and counterinsurgency operations, and to modernize outdated defense equipment, the report said.
“Algeria has witnessed growing instances of terrorism from Al-Qaeda and other Islamic militant organizations in the past. ... Another factor driving Algeria’s defense procurement is the neglect the [domestic] industry faced for many years,” the report states.
Among the key ground warfare orders in Algeria’s pipeline is a US $248 million contract with a subsidiary of German defense equipment manufacturer Rheinmetall to supply 1,200 variants of the Fuchs armored personnel carrier (APC) for delivery over the next decade. Algeria acquired 54 of the APCs in 2011.
Further acquisitions include APCs from NIMR, a subsidiary of the United Arab Emirates’s Tawazun Holdings. NIMR this year will start jointly producing the APCs in the Algerian city of Khenchela.
The NIMR vehicles, in four- and six-wheel drive, can be configured for various missions, including reconnaissance, border surveillance, logistics, urban warfare, ambulance, command and control, and as an armored personnel carrier.
By setting up in Algeria, NIMR Automotive aims to expand its share of the North African and Middle Eastern markets. More than 500 NIMR APCs have been delivered to Libya, Jordan, Lebanon and the United Arab Emirates, while more than 1,800 are on order.
Libya also has stepped up defense spending on ground warfare, recently taking delivery of 10 fully amphibious 9P157-2 Khrizantema-S tank destroyers from Russia, increasing its fleet to 14.
The consignment is part of $4 billion worth in hardware ordered by former strongman Col. Moammar Gadhafi.
This year alone, Libya has received 20 Puma armored vehicles from Italy, 49 Jordanian-made NIMRs from the UAE, 24 Humvees from the US, 300 BRDMs from Serbia and signed a contract to upgrade 300 BRDM APCs already in service.
Meanwhile, the South African government has contracted state-owned defense equipment manufacturer Denel to build 264 Badger infantry combat vehicles (ICVs) to replace the military’s armor-protected combat vehicles, which include the Ratel, the Casspir and the Mamba, among others.
Delivery is expected over the next 10 years, and the total value of the deal is estimated at 8 billion rand (US $805 million).
“This is the most significant defense contract signed with a South African company in at least the last 10 years, and demonstrates government and the [South African National Defense Force’s] confidence in the ability of the local industry to provide front-line equipment,” Denel Group Chief Executive Riaz Saloojee said.
South African Defense Secretary Sam Gulube said the production of the Badger APC is important because it will provide the battlefield capabilities necessary for troops to become more involved in peacekeeping operations in other African countries. Denel already has produced a GI-30 30mm Cam-Gun electro-mechanical cannon, which was designed and manufactured for the Badger ICV.
It was exhibited internationally for the first time in London last month.
Denel also recently tested the land-based version of its Umkhonto surface-to-air missile, with the weapon destroying targets at a range of 20 kilometers. It is deployed on South African naval frigates, and Algeria has ordered some for use on its Meko-class frigates.
Other Parts of Africa
Faced with financial constraints and growing military demands of the war against Islamist sect Boko Haram, Nigeria is pushing to revive the local defense industry. Still, it decided to import more than 30 armored personnel carriers, mostly South African-made versions of the Springbuck, for reconnaisance, patrol, command and control, force protection and VIP transport duties.
The country also ordered Springbuck IV mine-resistant, ambush-protected vehicles to improve force protection and mobility in the face of a transnational terrorist insurgency that relies heavily on heavy bombs and improvised explosive devices. Last month, Nigeria and Senegal became the first African countries to take delivery of an undisclosed number of ballistic armored tactical transport (BATT) APCs.
Imported from US-based defense equipment maker The Armored Group, the APCs are designed for both rural and urban warfare and include a range of vehicle protection levels.
“We have seen an increased demand for our BATT family of vehicles because of their unparalleled performance, protection, deployment options, operational capabilities and affordability,” said Robert Pazderka, president and founder of The Armored Group.
He said additional orders for the BATT have been received from Iraq, Afghanistan, Pakistan, Egypt, Libya, India, Argentina, Brazil and Mexico.
In East Africa, Kenya has overtaken Uganda and Ethiopia to become the top ground warfare defense market. Among a string of defense deals signed since it began preparing for the war against Somali-militant group Al-Shabab in 2011, Kenya has acquired eight Russian-made BRDM-3 reconnaissance vehicles, with an additional 88 to be purchased for a total cost of $105.6 million.
According to the Stockholm International Peace Research Institute, Kenya has been increasing its spending on ground warfare equipment since 2006. It says in that period, Kenya took delivery of 110 T-72 tanks, 44,500 assault rifles, 655 rocket launchers, 550 machine guns and 11 BM-multiple rocket launchers.
Retired Zimbabwean Col. Joseph Sibanda, a defense analyst, said the African defense market will grow steadily over the next decade.
“Africa will in the next few years rise to become a defense market almost at the same level with Latin America and Southeast Asia,” he said. “Military aircraft, armored vehicles and advanced artillery systems will be top of the list as African militaries and law enforcement authorities modernize to meet new security threats.”
He said countries need better firepower, mobility and force protection to fight growing threats from militants in east, west and North Africa.
Oxford Analytica, a global analysis firm, said Africa has reached “an expansionary period for most of its leading armies,” and attributed this to growing donor-funded peacekeeping operations involving African forces and “elevated security threat perceptions.”
This has been particularly evident in Uganda, Ethiopia, Kenya and Nigeria, the firm said.
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