There are growing indications that a floriculture and agriculture project offset project by the German Submarine Consortium does not exist.

If this is accurate , it calls into question the facts and figures government is advertising to illustrate the apparent benefits offset projects are generating for SA from the arms deal.

The trade and industry department states in its latest six month review of national industrial participation projects that the consortium's agriculture and floricultural project in Eastern and Western Cape was established in 2001 and has generated 1500 jobs.

South African Protea Producers and Exporters' Association chairwoman Maryke Middelmann said at the weekend that the association negotiated with Ferrostaal the lead company in the consortium two years ago on possible co-operation.

These talks came to naught, however, as the two parties could not reach an agreement.*

"They wanted to market proteas for domestic producers overseas, while we wanted them to assist us with promotion in Europe," said Middelman.

South African Flower Industry Council head Dirk de Bruin was unaware of such a project.

"The industry employs only 20 000 people. If there was a project that added 1 500 to total employment, we would have known about it," De Bruin said.

Both the consortium and the trade and industry department have declined to make any comment on the project.

Questions have been raised about other offset projects by the consortium, from which government is buying three submarines.

Government's June report stated that the consortium would start a steel mill project in Eastern Cape this year. This project, however, has been scrapped. There were also doubts that the condom manufacturing plant planned for East London would go ahead.

Trade and industry department deputy director-general Lionel October said recently that he was confident the consortium would meet its obligations.

With acknowledgements to Carli Lourens and the Business Day.