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Africa On the Cusp of Vehicle Spending Spree

Jul. 15, 2013 - 03:45AM   |  
By OSCAR NKALA   |   Comments
Armor Interest: DCD Protected Mobility, the South-African builder of the Husky mine detection vehicle, is among a list of firms now marketing its vehicles to African nations.
Armor Interest: DCD Protected Mobility, the South-African builder of the Husky mine detection vehicle, is among a list of firms now marketing its vehicles to African nations. (US Army)
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BULAWAYO, ZIMBABWE — African countries are expected to spend up to US $20 billion on armored vehicles over the next decade, according to industry analysts and business executives, as governments battle a growing number of heavily armed transnational terrorist groups.

Specifically, nations in the Horn of Africa, Sahel-Magreb and West Africa are expected to invest in force protection equipment, experts say.

The experts made their forecast ahead of the Armoured Vehicles Africa conference in London the first week of July, which came as renowned armored vehicle manufacturers from Italy, Serbia, South Africa, the United Arab Emirates, Germany, Czech Republic, China and Britain scramble to snap up deals in Africa, as evidenced by recent acquisitions and moves by some companies to set up manufacturing plants in Africa.

Kenya, meanwhile, announced a US $700 million defense budget, which includes acquiring more and better-protected armored military vehicles in the 2013-’14 fiscal year; spending will go up to $800 million in the 2015-’16 budget.

Ivor Ichikowitz, chairman of South African-based armored military vehicle manufacturer Paramount Group, said the company sees high potential for market growth and will strive to meet the demand.

He said that while some countries in the Horn, North and West Africa are buying highly mobile, well-protected and heavily armed armored military vehicles for counterterrorism operations, many in sub-Saharan Africa — where the threat of terrorism is much lower — are seeking lightly armed, well-protected, high mobility infantry fighting, transport and logistics vehicles.

Rob King, managing director with South Africa-based DCD Protected Mobility, said because of increasing demand, the company is interested in business prospects in Africa in the next decade.

“We are excited about prospects in Africa. Armored vehicle local content is 40 to 60 percent and more for logistics vehicles,” King said.

DCD won international acclaim in the armored vehicle category when it unveiled the sturdy Husky mine detection vehicle, of which the US Army bought 1,700 for use in Afghanistan.

However, with the US Army pulling out of Afghanistan, DCD has shifted its focus back to Africa. The company recently commissioned a new 100 million rand (US $10 million) plant to manufacture armored cars at Isando outside Johannesburg, and pledged to remain among the leading suppliers to the growing African market.

In addition to the Husky clearance vehicle, DCD produces light and heavily armed variants of the Springbuck and Mountain Lion armored personnel carriers, most of which have been sold to the Nigerian Army and police forces. It also produces mine-resistant, ambush-protected versions of the Springbuck IV, which are widely used by Nigerian security forces.

However, the largest armored vehicle market remains in North and northwestern Africa, where countries are battling Islamist insurgencies that rely on heavy bombs and improvised explosives.

This year, Libya has ordered 300 BDRM and BVP-1 armored vehicles from the Czech Republic. The supply agreement includes the refurbishment of a further 300 variants of the heavily armored BDRM vehicles already in service with the Libyan Army.

In April, Libya received a total of 69 armored cars, with 20 Puma armored fighting vehicles coming from Italy and 49 Jordanian-made NIMR armored vehicles from the United Arab Emirates (UAE). Libyan Prime Minister Ali Zeidan said last week that the country needs more heavily armed, high mobility armored cars for border security, rapid response, force protection, logistics, mine detection and VIP transport operations.

Due to its protracted counterterrorism war, Algeria remains one of the larger armored vehicle markets. In 2011, the country ordered 54 Fuchs armored vehicles worth $248 million from Germany, and it is set to receive a further 1,200 of the same vehicle over the next 10 years.

Sensing the high potential for market growth in North Africa, UAE-based armored vehicle and defense equipment maker Tawazun Holdings last year signed an agreement with the Algerian government to set up a factory to jointly produce NIMR armored vehicles in Algiers.

NIMR Automotive, a subsidiary of Tawazun, intends to produce four-wheel and six-wheel variants of the armored vehicle. The company has received orders for 1,800 vehicles from North African and Middle Eastern countries.

Meanwhile, international defense consulting firm Frost & Sullivan has predicted a massive growth in African and Middle Eastern defense markets driven by defense modernization programs and the procurement of advanced defense platforms.

The report, titled “The Middle East and Africa Defence Market Assessment,” said the defense market earned revenues of $29.67 billion in 2012 and estimates this will reach $45.49 billion in 2021.

Saudi Arabia and the UAE in particular are looking to develop their military capabilities in the light of civil unrest and international instability.

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