The stimulus package has put the multi-billion Pula fighter jet project back on track and the Korean Aerospace Industries want a piece of the pie. The KAI, with its T-50 and the lighter version the FA-50, is determined to beat its nearest rival the Swedish-made Gripen. President Khama’s recent trip was all about the Asian country’s powers of persuasion on a man who is personally supervising the army’s biggest acquisition to date writes Staff writer TSHIRELETSO MOTLOGELWA.
The stimulus package has put the multi-billion Pula fighter jet project back on track and the Korean Aerospace Industries want a piece of the pie. The KAI, with its T-50 and the lighter version the FA-50, is determined to beat its nearest rival the Swedish-made Gripen. President Khama’s recent trip was all about the Asian country’s powers of persuasion on a man who is personally supervising the army’s biggest acquisition to date.
The Korean trip was mainly about the P6bn jet fighter deal. When the officials at Korean Aerospace Industries speak the politicians at Seoul listen.
The officials at the Asian country’s sole military manufacturer Korean Aerospace Industries want President Khama to choose their plane, and when they asked President Park to give their plan a lift, the leader not only invited Khama over but pulled all stops to give him the royal treatment. The major limiting factor to the Koreans, more specifically the KAI, was that they did not have closer connections in Government Enclave, let alone the highest office in the land, hence this trip.
Until two weeks ago the opponents of the multi-billion Pula fighter jet acquisition project thought they had cause to celebrate. After all, this is the army’s biggest acquisition – some say the fighter deal will set the government back by P3bn at the minimum, while others put the figure at around P6bn depending on the jet the army chooses. A month ago, The Business Weekly & Review reported that the hawks at BDF had been told to abandon their plans owing to the bleak financial prospects by government. Critics of the acquisition have always said the new fleet would be nothing but ‘toys for boys’ in an era where soldiers often lack basic supplies like tents and new socks.
So the jet deal was off and it was time to celebrate. However two weeks ago, President Khama announced the so-called Stimulus package. The details are sketchy, but BDF insiders say the jet deal is not just on the run-way but is almost on take-off. “Khama wants the fighter jet deal preferably done by end of year. But Khama, who has been supervising the process wants the project to be concluded” says a very high ranking army officer on condition of anonymity.
The security sector has had its fair share of debate around the jet deal. Military commentators such as Mmegi’s Richard Moleofhe argue that not only the army in general, but soldiesr in particular, have much more relevant and even desperate needs. However Khama, a soldier, avid pilot, and record spender during his time as BDF Commander, prefers the fighter jets, and fighter jets he will get. But that is none of the Koreans’ concern. The Koreans want to sell the FA-50, a more affordable version of the T-50. They were determined to roll out the red carpet and give the southern African country’s chief decision maker a convincing show.
Fighter jets do not come cheap and more so the T-50. The problem for the Korean project has always been the price. Some experts argue that the idea of using the T-50, or even the FA-50 would be very unsustainable considering its US$25m cost per single jet (the cost of the most basic), for a mere trainer. With a purchasing budget that rose from P574m in 2010-2011 to P627m in 2012, sources say the BDF was deeply wedged in an impasse over which jet to settle for with regard to its actual purchase cost, its maintenance costs and performance.
But sources in Korea say the Botswana contingent was given assurances that any deal would come with financial sweeteners courtesy of the Korean government itself. “The Koreans are very aware of the cost implications and wanted to say to the Botswana contingent, ‘We are open to alternative funding models and finance need not be an impediment’, said a Korean observer.
Khama visited the headquarters of KAI, and was given a full presentation on the abilities of the T-50, and its various versions. This week the Office of the President declined to comment on the full details of that trip, directing The Business Weekly & Review inquiries to their counterparts at Ministry of Foreign Affairs and International Cooperation who had not responded by going to press. It is not clear whether the T-50 will win the tactical battle, after all, the Swedes have also presented a case for their Gripen fighter project. SAAB, the Gripen manufacturer has promised local investment, looking to pivot on its South African position to put infrastructure locally. They have already opened an office in Gaborone.
The major problem for both the Korean and Swedish suppliers has always been insiders who are selling the idea of BDF keeping its F-5 platform, only refurbishing its current fleet. Fact finding missions for the fighter jet project have so far included trips to Brazil, South Korea and Israel.
GRIPEN – OLD FRONTRUNNER?
The fact that South Africa used the Gripen, encouraged experts. In what many experts said was an indication of its commitment to the Botswana market Saab South Africa set up an office in Gaborone, two years ago, and confirmed that Botswana was a potential buyer of its war machines.
The Koreans – new front runners?
However at the same time senior members of the defence sector continued their fact-finding mission. The same year then Minister of Defence, Justice and Security, Ramadeluka Seretse accompanied by the Commander, Botswana Defence Force, Lieutenant General Gaolathe Galebotswe, attended the Seoul International Aerospace and Defence Exhibition (Seoul Adex 2013) in Korea at the invitation of the Chairman of the Joint Chiefs of Staff Seoul where sources have alluded that a deal to purchase fighter jets was made. KAI President and Chief Executive Ha Sung-yong, told a press conference, in 2013, in North Korea, quoted by the country’s daily publication saying they were expecting the Botswana deal to go through.
The Brazilian deal
Then came the Brazilians. Three years ago at the time the BDF was beginning to toy with the idea of a new fleet, BDF experts went on a fact finding mission to Brazil to witness the Latin American country’s F-5s. The Brazilians were advertising their upgraded F-5s which they were willing to sell to the BDF, through a government to government program. Nobody knows what happened to that deal, although it remained the cheapest of the three deals being touted. Insiders say the main undoing of the Brazilian deal was that there were no middlemen, and thus no-one to fight for it in an industry known for achieving its deals through the work of middle men motivated by personal gain through an elaborate system of commissions.
The Israeli connection
Sometime last year a Brit of Israeli origin (name known to this publication) brought the idea of refurbished F-5s, through another intermediary within defence circles. The man, said to be connected to some shady army suppliers with links to the highest office in the land thought the deal, while more expensive than the Brazilian one, would still have the inside lane given the connections to Government Enclave.
In the contract that the ‘connected’ company has on the table, an Israeli company would offer refurbishment and in some cases procurement of refurbished F-5 jets. Insiders believed the Israeli company had an advantage not just because of the level of its connections, but also because it was promising to retain the current platform that the BDF has, the F-5 and hence limit costs in both infrastructure and pilot training. The new F-5 program would upgrade the current platform to F-5E by refurbishing the current F-5s that the BDF operates. The deal is said be around P600m compared to the more than P5billion that the T-50 deal was projected to cost. The BDF operates 14 F-5s, F-5A fighter jets and F-5D trainers it bought from Canada in 1996.
While the mysterious Israeli seemed to have the deal done, some BDF insiders put the spanner in the works. The deal stayed comatose for the last half year, until recently when Government informed BDF they could not proceed with any deal, given budgetary constraints. But now the funds are back. It is not clear what the new strategy for the Israelis will be given the escalation by the South Koreans.