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| PHÎÒÎ: PHL |
The state-run enterprise Ukrspetseksport and Egypt’s Ministry of the Military Industry have begun fulfilling the largest contract in the entire history of Ukrainian–Egyptian cooperation under the program of upgrading the outdated T-62 tanks and OT-62 TOPAS amphibious tracked armored personnel carriers for the Egyptian army
The tender for substantial upgrading of 200 APCs and 200 T-62 tanks was closed on December 14 last year in favor of Ukrspetseksport. Representatives of the state-owned Kharkiv Malyshev Factory said that the first two Ot-62 APCs were transferred from Egypt to the Oktyabrskiy port in Mykolayiv on July 6 and said the first shipment would be upgraded by Ukrainian enterprises according to the terms of the contract in the period 2010–2011. Modernization of the rest of the machinery should be executed according to the plan for the export of Ukrainian vehicle sets to Egypt. If bench tests are a success the vehicles will be delivered to the Abu Zaabal Tank Repair Factory outside of Cairo and the Kader Factory for Developed Industries in Heliopolis.
The term for assembly work in Egypt was one of the key requirements in the tender, which predefined the victory of Ukrainian enterprises.
For several years, the foreign media saw Russian Artillery Plant No. 9 and Uralvagonozavod (the latter claims to have rights for the majority of existing modifications of the T-62 tank) as the favorites in the race. The German enterprise Thyssen Henschell, which earlier helped the Egyptian government set up the production of APCs for land forces, and the Czech PPS Group, which earlier produced and supplied Ot-62 APCs to Egypt, also had planned to bid in the tender. The U.S. company Teledyne Continental Motors, which upgraded Soviet T-54 tanks for Egyptians, also tried to land the deal.
The proposals submitted by these companies were of little interest to the Egyptians, as the majority of contenders agreed to export vehicle sets only on the condition that joint ventures be created.
In the case with Ot-62 carriers, substantial upgrading envisages that the vehicle sets supplied to Egypt from Ukraine will consist of expensive components: a new engine transmission unit and a combat unit (turret with a machinegun, mortar, automatic cannon and an anti-tank missile unit). For T-62 there are plans to replace all key components: gun, engine-transmission unit, under-carriage elements and armored parts.
By the highest standards, the supply of components beyond the production scheme gives manufacturers the opportunity to bypass the international limitations on the supply of arms to regions of the world where there are civil and military conflicts.
For example, at the end of the 1990s Thyssen Henschell supplied Egypt the sets for 500 Fahd APCs, 300 of which were exported from Egypt. Taking advantage of its participation in trans-African and trans-Arabian international peacekeeping missions, Cairo exported over 300 Fahds to hotspots of regional conflicts – Chad, Sudan and Congo (Zaire) – in other words, to countries where the German company for one reason or another could not or did not want to sell its hardware.
The conflicts in the aforementioned countries are raging on and Egyptian peacekeeping missions continue to reinforce their influence there. This forces Ukraine to fight for positions in those markets, competing mainly with Russian and Belarusian suppliers of military hardware from the Soviet era.
Also important is that U.S. and EU policies are officially based on the fact that the strengthening of the positions of Russian suppliers in those regions is unwanted, unlike producers from Ukraine and Eastern Europe. Last year’s incident with the Faina ship transporting a large shipment of Ukrainian military hardware to Kenya, more precisely for peacekeeping missions in one of the neighboring countries, was testimony to the fierce competition in this industry on the North African market.
The shadow of this incident cast on insurance companies and freight forwarders backed by Ukrainian capital. Certain industry experts did not rule out the possibility that the owners of the owners of the Faina could have deliberately disclosed navigational information about the ship’s route to local pirates.
If the contract with Egypt is successfully fulfilled and no “proprietors” interfere, Ukrainian machine building companies will be able to find a convenient and mutually beneficial foreign ground for strengthening their positions in specialized foreign markets.
In the end the Egyptian government decided to bring back into service only 200 T-62 tanks of the 500 it possesses and there is a very good chance that the upgrade contract will be extended for the full quantity. Most experts say everything depends on the development of Ukraine’s domestic policy, including the quality of staffing policy in government bodies that control arms export.
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