Paramount Group in talks to develop Africa's defense industry

ABU DHABI (Reuters) - South African defense company Paramount Group expects to sign agreements with four African governments this year to set up production facilities in their countries, its chairman said on Sunday.

FILE PHOTO - Paramount Group military aircraft are seen on display at the Africa Aerospace and Defence expo at the Waterkloof Air Force Base near Pretoria, South Africa, September 21, 2018. REUTERS/Joe Bavier

Paramount, Africa’s largest privately owned defense firm, has established manufacturing capabilities to meet demand from specific domestic markets before, including in India, Jordan, and Kazakhstan.

It is in talks with four countries in west and east Africa over deals that it expects to sign this year. A further three agreements could be signed in southern Africa in two years’ time.

“Africa really is innovative,” Ivor Ichikowitz told Reuters at the IDEX military exhibition in Abu Dhabi.

“There is a huge amount of skill. There is a huge amount of human capital on the African continent that makes what we are planning to do very achievable.”

Paramount, which has maintenance and overhaul operations in Africa, has started to implement some agreements, he said, declining to disclose further details.

The company manufactures military vehicles, aircraft, ships, and weapons systems. It is also interested in working with governments on software, cyber security, and artificial intelligence, Ichikowitz said.

Commenting on the potential shape of any deals, the company prefers to be a majority shareholder in a government joint venture with concessions to build domestic capabilities, he said.

“We would implement long-term training, long-term capacity creation programs which would ultimately put us in a position where we are building a domestic defense industry in that country.”

Paramount has previously held talks with Saudi Arabia and the United Arab Emirates, two Middle East countries heavily investing in domestic defense industries.

Ichikowitz declined to comment specifically on those talks but said that in the Middle East “there are substantial agreements close to finality”.

Paramount on Saturday launched a 4x4 version of its Mbombe armored personnel vehicle, which Ichikowitz said had been designed for the operational requirements of Middle East countries.

He said he expected there would be regional demand for 4,000-5,000 of the vehicles over the next ten years.

Reporting by Alexander Cornwell; Editing by Jan Harvey