BAE Systems, a supplier in SA’s arms procurement programme, says it has awarded local aerostructures manufacturer Aerosud a R137,7m contract to produce components for Eurofighter Typhoon combat aircraft.

The contract would run over six-and-a-half years. It was part of the industrial participation programme in which BAE and other beneficiaries of the multibillion-rand arms deal committed to stimulate economic activity through investments.

In the past few years the pace of the offset programmes has come under the spotlight amid fear that the multinational groups would struggle to meet their obligations.

The trade and industry department’s chief director for industrial participation, Sipho Zikode, said yesterday that the offset programmes were working. “For a long time people have been hammering the offset projects, saying they were not working.”

He said the pace of the offset programme had picked up after a slow start. “We never hid the fact that the offset started slowly. The various companies had to settle and get used to the local economic and political environment. From around 2003 we started to see offsets picking up,” he said.

BAE Systems’ CEO in SA, Mike O’Callaghan, said the contract entailed the manufacture of 3500 parts and small assemblies for the fighter jet.

The agreement was a follow-up to the BAE and Aerosud “strategic” partnership contract signed two years ago, which will boost Aerosud’s standing as a supplier of aviation components.

Aerosud MD Paul Potgieter said the Eurofighter contract would support the company’s ambition to be a major global supplier of niche services and products.

Eurofighter Typhoon would provide a cornerstone of the North Atlantic Treaty Organisation’s defence capability for the next 30 years, he said.

In an initial order under the agreement, Aerosud was manufacturing wing components for the Airbus A320.

BAE Systems owns 20% of Airbus.

It would manufacture more than 200000 components for the Airbus family as a result of unprecedented demand for A320 aircraft.

With acknowledgement to Siseko Njobeni and Business Day.