A $1bn stainless steel plant at Coega offset for the purchase of three German submarines has morphed into a condom factory at East London.

The BAE and BAE/Saab offsets against the purchase of warplanes that the SA Air Force didn't want were supposed to generate foreign investments worth $1,3bn. So far, the failing Ecoplug venture and a kind of chewing tobacco called Taxi (banned in Europe because of fears of cancer) are about all BAE can cite as evidence of delivery.

The bizarre R24m Hivex machine in KwaZulu-Natal to radiate HIV/AIDS is another BAE offset project. Recent BBC and print media inquiries in Britain have confirmed that, other than sweetheart contracts for Denel, BAE offsets for the arms deal are virtually nonexistent.

Undeterred, Trade and Industry Minister Alec Erwin (Business Day, June 9) now declares that "the offset programme has markedly improved SA's economic landscape". Where is the evidence?

At a conference in September on defence offsets and economic development, about 35 academics from the US, UK, Sweden, Belgium, Argentina and SA unanimously agreed that offsets were inappropriate for military procurement and economic development.

As if in agreement, the defence force budget briefing to Parliament last week confirmed that the arms deal has financially paralysed it. For political reasons directed by the cabinet, the SA Navy and SA Air Force have been committed to useless equipment and expenditure.

International experience proves offsets are a scam promoted by the armaments industry, with the connivance of politicians, to fleece taxpayers. The fact that Erwin's department has made offsets a matter of obligatory government policy illustrates how the corruption of the arms deal pervades the country.

Terry Crawford-Browne
Economists Allied For Arms Reduction SA

With acknowledgements to Terry Crawford-Browne and the Business Day.