State-owned aerospace and military technology company Denel systems engineer Dr Makhabane Molapo has outlined his view of what the struggling entity should pursue to revitalise this strategic asset for defence sovereignty and industrial growth on the continent.

Speaking during the conference segment of the Africa Aerospace & Defence Expo, being held this week at the Waterkloof Air Force Base, in Tshwane, Molapo emphasised the importance of Denel, highlighting it as a strategic national security asset and custodian of sovereign defence technologies, intellectual property (IP), engineering expertise and industrial capability.

He pointed out that defence sovereignty required indigenous capability, with the country needing to retain the ability to design, develop, manufacture, integrate, maintain, upgrade and sustain critical defence systems domestically.

Molapo noted that, with the global environment changing owing to global instability, vulnerable international supply chains and growing technological competition, defence self-reliance was becoming increasingly important.

He acknowledged that Denel had suffered considerable decline, which had been well documented, and included financial and liquidity constraints, loss of critical engineering skills, ageing infrastructure and weak domestic defence demand.

Despite the severe institutional and financial decline, there was still significant sovereign capability, market opportunity and recovery potential, Molapo highlighted, citing several contracts in the pipeline, experienced management in place, and good governance.

Therefore, he proffered a suggestion of a fundamental business model shift for the entity, from a “South Africa – to product – to African customer” approach, to one of “South Africa – to African partners – regional capability”. This would present a fundamental shift from transactional to transformational, he asserted.

Molapo emphasised that the entity’s next phase should be about creating a stronger, more integrated and commercially sustainable defence-industrial model.  

He highlighted that the proposed growth pathway was progressive, with South Africa to strengthen its home base, “own the neighbourhood”, build with the continent, create a federated Denel Africa and compete globally.  

Strengthening the home base would entail rebuilding the country’s domestic foundation through local procurement, South African National Defence Force and South African Police Service opportunities, sovereign capability and core production, Molapo averred.

Owning the neighbourhood would comprise establishing a stronger Southern African Development Community  (SADC) footprint through regional customers, lifecycle support and training, he said.

Creating a federated Denel Africa would require developing regional industrial hubs, integrated African supply chains, shared capabilities and African partnerships, Molapo indicated.

He said that Denel Africa should become a federated African defence-industrial network, with South Africa providing core technology, IP system integration and engineering, supported by regional partnerships across SADC, West Africa and North Africa.

Competing globally would leverage the strengthened African industrial base to pursue exports, strategic partnerships, niche technologies and global programmes, he highlighted.

Meanwhile, Trade, Industry and Competition Minister Parks Tau emphasised that the transformation agenda should be a pivotal part of the work of the Aerospace Industry Support Initiative (AISI), as it continued with its work in supporting and developing small and medium-sized enterprises.

The Minister was speaking at the 20-year commemoration of the agency, which was held during the expo.

AISI was established by the Department of Trade, Industry and Competition to strengthen the competitiveness, sustainability and growth of South Africa’s aerospace and defence industry through building capability, research, design and innovation.

It is supported and managed in its work by the Council for Scientific and Industrial Research.

Tau said preserving sovereign industrial capability, advancing dual-use technologies, and retaining and upskilling critical technical skills were essential to South Africa’s national security and long-term competitiveness.

“Transformation matters here more than in most sectors, precisely because aerospace and defence have always been among the hardest industries to enter. Capital intensity, certification requirements and decades of concentrated ownership have kept these industries largely closed to black entrepreneurs and emerging enterprises. If we do not deliberately open that door, the next 20 years will simply repeat the exclusions of the last,” he averred.

Tau pointed out that the AISI currently required the firms it funds to hold at least Level 4 broad-based black economic employment status, and it is deliberately building a pipeline of black industrialists, innovators and technology developers who must be able to compete in local and global markets.