Pretoria: The government has signed an aviation deal with European aircraft manufacturer Airbus - which could benefit the economy by between R6 billion and R15bn, according to Public Enterprises Minister Alec Erwin.

The deal, which sees local aviation companies become global partners in the building and design of the new A400M military aircraft, will also allow South Africa to purchase between eight and 14 craft at a later stage.

Erwin said participating in the programme would boost and revitalise the local aerospace industry.

The A400M, which would ultimately replace the SA National Defence Force's ageing C130 transport fleet, is set to be in full production by 2009.

Defence Minister Mosiuoa Lekota said the acquisition of the aircraft would greatly benefit not only South Africa but Africa.

He said the country had a large role to play in peace support initiatives and disaster management, which was costing "huge money" because flights had to be chartered.

"This deal will go a long way to equip our forces in the region," he said.

The SANDF's current military transport and airlift capacity is carried by a small fleet of nine Hercules C130 aircraft which are due to be replaced by about 2010.

But the deal was described as not only being of military value but also economic.

Francisco Fernandez Saintz, managing director of Airbus Military, said the company had already confirmed orders for 180 aircraft to be built - a process in which South Africa would be completely involved.

Richard Thompson, senior vice president, commercial, said South Africa had become a global partner in a "benchmark programme" which would see new military aircraft designed and built through a non-military process that would incorporate cutting-edge technology.

Local companies Denel and Aerosud have been named as contributors because of their existing experience and capability in aircraft manufacture, but Thompson said that as the process moved forward more companies would be contracted.

The agreement states that as the programme matures between 2010 and 2014, South Africa would be allowed to take delivery of between eight and 14 aircraft. Eight aircraft would cost e837 million.

With acknowledgements to Sapa and the Cape Times.