Paul Lewis/SINGAPORE
The Malaysian defence ministry is conducting a sweeping review of planned weapon procurements in response to a Government call to cut costs because of economic difficulties.
Kuala Lumpur has instructed all ministries to make an immediate across-the-board cut of 2% in expenditure, as it struggles to deal with a severe currency and stock- market crisis. The defence ministry is due to present its revised spending plans in mid-October for the remaining 36 months of the current five-year plan.
Local observers say that cutbacks in expenditure are likely to result in the cancellation or deferral of many large defence programmes still outstanding in the 1996-2000 plan. Some major aerospace acquisitions will be among the programmes affected.
The largest single project expected to be delayed is the Royal Malaysian Navy's new offshore patrol combatant (OPC). The navy had planned to build up to 27 warships, but with the project now in doubt, helicopter manufacturers are anxious to see if the navy's shipboard helicopter purchase will proceed as planned.
GKN Westland is now in the middle of detailed technical discussions with the navy after the latter signed a letter of intent to purchase the LHTEC T800-powered Super Lynx (Flight International, 6-12 August). Kaman is still pushing the rival SH-2G Super SeaSprite. The initial order is for three to six helicopters, with the navy ultimately purchasing a much larger number to equip the OPCs.
Sources suggest that the initial purchase is likely to proceed because the machines are needed for two frigates due for delivery in 1998. The navy has still to go back to the finance ministry for final approval, however.
Other rotary-wing procurements now under scrutiny include the attack-helicopter requirement, which Denel is favourite to win with its CSH-2 Rooivalk, and a new air force utility helicopter. The attack-helicopter procurement is likely to be postponed, while the planned transport could be shelved in favour of refurbishment of the Sikorsky S-61 Nuris.
The neighbouring Thai military is facing similar fiscal pressures following a 40% devaluation in the baht, and a government clampdown on spending.
Source: Flight International