development of the aerospace & defence masterplan for south … · 2020. 4. 9. · defence does...

A & D Industry Masterplan Inception report

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Josie Rowe-Setz

BLUEPRINT (PTY) LTD, MAUDE STREET, NELSON MANDELA SQUARE, SANDTON

FINAL INCEPTION REPORT

Development of the Aerospace & Defence Masterplan

for South Africa March 2020

A & D Industry Masterplan Inception Report

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Table of Contents

1. PURPOSE OF THIS ASSIGNMENT 6

1.2 OBJECTIVES OF THIS WORK 6

2. PURPOSE OF THIS REPORT 8

3. CONTEXT 8

3.1 HISTORICAL LINKS- SOUTH AFRICAN AEROSPACE AND DEFENCE 8 3.1.1 DEFENCE 9 3.1.2 AEROSPACE 11 3.1.3 SPACE 14 3.2 POLICY IMPERATIVES 16

4. APPROACH AND METHODOLOGY 17

4.1 APPROACH 17 4.1.1 STAKEHOLDER CONSULTATION & ENGAGEMENT 18 4.1.2 EVIDENCE GATHERING 19 4.2 METHODOLOGY 20 4.2.1 STAKEHOLDER ENGAGEMENT 20 4.2.2 RESEARCH AND ANALYSIS 22 4.2.3 SCOPE OF WORK & DELIVERABLES 25 4.3 TOOLS 27 4.3.1 SITUATIONAL ANALYSIS 27 4.3.2 CONSULTATION 28 4.4 PROCESS OVERVIEW 28 4.5 OUTPUTS 29

5. PROJECT MANAGEMENT 31

5.1 PROJECT RISK PROFILE 31 5.2 RESPONSIBILITIES OF THE CLIENT 32 5.3 PROJECT PLANNING- TIMELINE 32 5.4 PROJECT RESOURCING 34 5.5 PROJECT TEAM 34 5.6 PROJECT GOVERNANCE 38


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ANNEXURES 41

ANNEXURE ONE- DOCUMENTS AND DATA FOR REVIEW 41 ANNEXURE TWO- STAKEHOLDER LIST FOR CONSULTATION SELECTION 45 ANNEXURE THREE- SITUATIONAL ANALYSIS DRAFT TOC 46 ANNEXURE FOUR- MASTERPLAN DRAFT TOC 48 ANNEXURE FIVE- LOCATING KEY SUB VALUE CHAINS 49 ANNEXURE SIX- TABLE OF DEFINITIONS TO DATE 51

Tables

Table 1-Scope Specifics .................................................................................................................. 6 Table 2- Selected South African Developed Technologies .......................................................... 13 Table 3- Very preliminary overview of Value Chains for Review ............................................... 20 Table 4- Indicative List of Stakeholders for Consultation ............................................................ 21 Table 5- Research Methods Used ................................................................................................. 24 Table 6- Deliverables Table .......................................................................................................... 26 Table 7- Action & Implementation Plan- Example ...................................................................... 30 Table 8- Proposed Submission and Presentation Dates ............................................................... 32 Table 9- Project Team ................................................................................................................... 34 Table 10- Sample Document Review list ..................................................................................... 41 Table 11- Preliminary Table of Definitions .................................................................................. 51

Figures

Figure 1- Inception Report Activities ............................................................................................. 8 Figure 2- High Level Aerospace Value Chain .............................................................................. 14 Figure 3- Overview South African Aerospace and Defence Economy ........................................ 16 Figure 4- High level Stages & Timing .......................................................................................... 23 Figure 5- Overview Timing .......................................................................................................... 25 Figure 6- Process Overview .......................................................................................................... 29 Figure 7- Master Plan Format ....................................................................................................... 29 Figure 8- Example GANTT Implementation Timeline ................................................................ 30 Figure 9- Sample Monitoring & evaluation plan .......................................................................... 31 Figure 10- Workflow & plan ........................................................................................................ 33 Figure 11- Governance Structure- Masterplan Process (current) ................................................. 38 Figure 12- Ice cream industry value chain .................................................................................... 50


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Acronyms

Acronym Expanded Term ADMSA A& D Masterplan for South Africa AISI Aerospace Industry Support Initiative AMD Aerospace, Maritime & Defence Industry

Association of South Africa APC Armoured Personnel Carrier ARMSCOR Armaments Corporation of South Africa ATNS Air Traffic and Navigation Services CAA Civil Aviation Authority CAASA Commercial Aerospace Association of South

Africa CAMASA Commercial Aerospace Manufacturing

Association of South Africa CAV Centurion Aerospace Village CFRTP Continuous Fibre Reinforced Thermoplastic

Plastic CPUT Cape Peninsula University of Technology CSIR Council for Scientific and Industrial Research CTFL Clothing, Textiles, Footwear and Leather DBSA Development Bank of Southern Africa DHEST Department of Higher Education, Science and

Technology DoD Department of Defence DoT Department of Transport DPE Department of Public Enterprises DPME Department of Planning, Monitoring and

Evaluation DPRU Development Policy Research Unit DRDB Defence Research and Development Board DSI Department of Science and Innovation DTI Department of Trade and Industry DTIC Department of Trade, Industry and

Competition DTPS Department of Telecommunications, & Postal

Services EO Earth Observation ESEID Economic Sectors, Employment and

Infrastructure Development ESOA Europe Middle East and Africa Satellite

Operators Association


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Acronym Expanded Term EW Electronic Warfare IADS Integrated Air Defence Solutions ICASA Independent Communications Authority of

South Africa ICT Information & Communications Technology IDC Industrial Development Corporation IFF Identification, Friend or Foe IP Intellectual Property IPAP Industrial Policy Action Plan IPAP Industrial Policy Action Plan ISR Intelligence, Surveillance & Reconnaissance JASC Joint Aerospace Steering Committee M & E Monitoring & Evaluation MRO Maintenance, Repair and Overhaul NAC National Aerospace Centre NACoE National Aerospace Centre of Excellence NCACC National Conventional Arms Control

Committee NDP National Development Plan NMU Nelson Mandela University NT National Treasury OEM Original Equipment Manufacturer OTR Overberg Test Range PBF Powder Bed Fusion PESTEL Political, Economic, Social, Technological,

Environmental and Legal PIC Public Investment Corporation PPGI Public Private Growth Initiative R&D Research & Development RIS Reinvigorated Industrial Strategy SAA South African Airways SAAF South African Air Force SACAA South African Civil Aviation Authority SACSA South African Council for Space Affairs SADF South African Defence Force SADI South African Defence Industry SANDF South African National Defence Force SANSA South African National Space Agency SAPS South African Police Service SARA Small African Regional Aircraft SDG Sustainable Development Goal


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Acronym Expanded Term SDP Sector Development Plan SEIAS Socio Economic Impact Assessment System SMART Specific, Measurable, Attainable, Realistic

and Timely SMME Small, Medium and Micro Enterprise SOE State Owned Enterprise SUN Stellenbosch University SWOT Strengths, Weaknesses, Opportunities and

Threats SWOT Strengths, Weaknesses, Opportunities and

Threats TIA Technology Innovation Agency UAS Unmanned Aerial System UAV Unmanned Aerial Vehicle UCT University of Cape Town UKZN University of Kwazulu-Natal UWC University of the Western Cape WITS University of the Witwatersrand


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1. Purpose of this assignment The South African Aerospace and Defence economy has been identified by the Industrial Policy Action Plan (IPAP) since its inception and now in the Reinvigorated Industrial Strategy (RIS) as one of the 151 priority South African economic sectors for support and development. As a result, a Masterplan for this economy (sector) is required, which will, inter alia,

• Protect and create jobs; • Deepen sector capabilities; • Expand exports; and • Prepare for policy change and related impact (if applicable) (the dti, 2018).

An industry Masterplan is required which will provide a clear, agreed, pragmatic and implementable plan for the industry going forward, rooted in evidence and agreed by industry, government2 and organised labour in a coordinated approach to industry growth and development.

1.2 Objectives of this work The objective of this work is to develop an agreed-upon set of actions, with timeframes, that all stakeholders in the Aerospace and Defence economy will commit to implementing for the benefit of the sector and/or relevant sub sectors and value chains. The agreed scope is shown below. TABLE 1-SCOPE SPECIFICS

Item Purpose Comment Comprehensive review of the South African value chain for the Aerospace and Defence industry. (This includes Maintenance, Repair and Overhaul (MRO) and aircraft structures, but excludes the remainder of General Aviation)

Establish empirical profile of the sector/industry; Achieve agreement on the profile from stakeholders;

Aerospace is made up of two distinct sub sectors- Commercial and Defence3- and sectors underneath. More than one value chain will be supplied as well as the overall chain. Defence also contains a number of sub value chains which require interrogation and prioritisation include land and naval systems. Value chains will be grounded in existing research and will use a capability approach as the basis for analysis.

1 Sectors are: Steel & Metal Fabrication; Clothing, Textile, Leather & Footwear (CTFL); Chemicals & Plastics; Tourism; Creative sector; Mining & Beneficiation; Gas, Renewables/Green; Defence & Aerospace; Health; ICT & Software Production; Oceans; Poultry; Cannabis; Agriculture & Agro-processing and ; the Digital Economy 2 In this case, includes State Owned Enterprises (SOEs) 3 Commercial aerospace includes aeronautics, space, general aviation. Defence includes maritime, land systems, (defence) aerospace


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Item Purpose Comment A Strengths, Weaknesses, Opportunities (SWOT) and Threats analysis of the industry; Locate the South African Industry in global context; Determine lessons for SA industry from international cases.

Extensive consultation to derive final SWOT and agreement as to South African location in global value chains; Relevant case studies; Useful lessons for South African industry

Commercial and defence aerospace is a global industry, and South Africa occupies positions at various points on the global value chain; South Africa has clear competitive advantages in some areas, and others can be built; South Africa has a solid aerospace and defence legacy from which to build and restore the industry.

Finalise a shared vision and mission for the sector through a process of consultation and consensus building

Agree vision and mission statement.

Consultation and consensus building process will deal with more than one deliverable at the same time. In some cases, consultation has to be one-on- one due to sensitivity issues pertaining to defence and aerospace. Potential for larger workshops is likely to be limited to stakeholder specific groups, thus more and smaller group consultations will be needed.

Through a process of consultation and consensus building, develop and provide draft programmes for action by the parties to achieve the vision and mission

Agreed, supported and committed time bound plan of action.

Through a process of consultation and consensus building, develop and provide policy and regulation recommendations to government focussed on achieving the vision and mission; and develop and provide time-bound development targets for industry and labour.

Agreed recommendations and development targets.

Determine in consultation an institutional structure to be charged with implementation of the Masterplan

Provide recommended structure.


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Item Purpose Comment Final report and PPT Includes the industry

evidence driven profile; the SWOT and draft Master Plan

Format as provided in template.

2. Purpose of this report This inception report is the first deliverable of the assignment. It confirms the approach, methodology, timelines and deliverables required and the project team. The figure below indicates the activities which form the inception report completion process.

FIGURE 1-INCEPTION REPORT ACTIVITIES

The inception meeting with the Working Group (WG) is followed by detailed project team planning and a preliminary review of documentation gathered to date. This report offers a final view of the workplan and the roadmap to delivery for this assignment.

3. Context 3.1 Historical links- South African Aerospace and Defence Broadly speaking, aerospace can be divided into commercial and defence activities, markets and products. In terms of defence activities4- the aerospace and defence industries in South Africa have a very close association with each other, technologically and industrially, and need to be considered as one broad sector. This is further reinforced by their relatively small sizes in comparison to other mainstream sectors, such as Mining. Although there is significant cross-over, defence does however, incorporate activities, products and markets which are not aerospace

4 However, there are a number of defence products and services which fall outside aerospace, designed and manufactured in South Africa, which will be covered in the category “other defence”

Inception meeting - work plan to be confirmed

Blueprint team internal scope and detailed research plan finalisation

Review of preliminary documentation and finalisation of detailed workplan and deliverable dates and mode

Preparation and submission of inception report

February 2020


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related, and these are categorised as defence. Similarly, aerospace encompasses a large segment of non-defence activities, defined as commercial aerospace.

Most of the formative domestic technologies (and associated Research and Development (R&D) at the Council for Scientific and Industrial Research (CSIR) and universities) that were developed from the 1960s till the early 1990s- were driven by the needs of the Department of Defence (DoD)5, Armscor and the then South African Defence Force (SADF)6 and were then rooted in a national strategic defence requirement. From the mid-1990s however, R&D funding of this nature from the State for defence purposes was dramatically reduced in value.

This resulted in the creation of a range of new commercial aerospace manufacturers (e.g. Aerosud, Epsilon, AAT Composites) which began to compete for contracts on the open commercial market, domestically and internationally. Many of these manufacturers – for example Aerosud – became very successful commercial partners for global firms such as Boeing, Airbus, and Bae Systems and entered their global supply chains. Nevertheless, many still operate in both worlds and still work on contracts for the South African Air Force (SAAF), SAAB Grintek Defence, the South African Police Services (SAPS) as well as commercial partners. Denel in particular has been a central strategic leader in the A & D industry since its formation. Some specific examples include:

• Denel operating units are involved with both military and civilian aerospace products and undertake commercial contracts. For instance, Denel Dynamics’ Unmanned Aerial Vehicle (UAV) programme can service military, civilian and humanitarian markets;

• Many smaller high-technology companies service the security industry, whether it is border security, infrastructure security (for instance, airports, national key points, and harbours) or asset management for the retail, telecoms and banking sectors, and;

• Lower tier manufacturers, making for instance metallic or composite components and assemblies, will also service other sectors such as automotive, boat building and construction.

The R&D and university research space still serves both worlds and undertakes research and human capital development that has relevance to both sectors.

3.1.1 Defence7 The 2015 Defence Review, which has been accepted by the Presidency, the Cabinet and Parliament, recommended that South Africa should retain and enhance its defence industrial capability: “South Africa requires an effective defence capability, which includes, as an integral element, a defence industry to support sovereign capabilities and maintain an essential level of strategic independence”. Not only this, but from a national strategic perspective, the defence industry is the essential beachhead for high-level engineering and technological jobs in the South African economy. Notwithstanding this role of defence, the national defence budget has been reducing over time, and this has had a marked effect on defence capability initiatives.

5 South Africa formed its first DoD in 1912 6 The SANDF came into being after 1994 7 Refer Annexure 6 for full definitions


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While defence related products can be traded through government-to-government contractual arrangements, which are, in turn, dependent on diplomatic relations between the countries involved, governments often also procure from privately owned entities. The international trade in defence products is regulated and typically subject to complex geo-political agendas. South Africa has the required legislative and institutional structures and import and export controls in place, including the responsibility for Armscor8 in terms of the Armaments Corporation of South Africa Limited Act, Act No 51 of 2003, to establish a compliance administration system as required by applicable international law, the National Conventional Arms Control Act, Act No. 41 of 2002, and the Non-Proliferation of Weapons of Mass Destruction Act, Act No. 87 of 1993. South Africa’s National Conventional Arms Control Committee (NCACC), in its annual report for the 2018 calendar year, records the local defence industry as exporting products and services valued at more than ZAR4 billion, to 66 countries using 776 export permits approved by the NCACC. Most countries are however reluctant to procure defence products from countries whose domestic security forces do not have the same products in operation.

The largest entity in the sector – Denel- is a State owned Entity (SoE) and is currently in a precarious financial situation. As a result, it is actively exiting certain parts of its business. The core of Denel was formed in 1965 as the Atlas Aircraft Corporation which was tasked to manufacture aircraft for the South African Defence Force (SADF), and it is this function (now called Denel Aerostructures) that is being closed down9. Over its life span, Denel expanded into a wide range of additional defence related offerings – and thus it can group together several defence and aerospace divisions and associated companies. It provides turn-key solutions of defence equipment to its clients by designing, developing, integrating and supporting artillery, munitions, missiles, aerostructures, aircraft maintenance, unmanned aerial vehicle systems and optical payloads based on high-end technology. Its entities can be listed as follows:

• Denel Aeronautics – Original Equipment Manufacturer (OEM) for Rooivalk and ACE, Design Authority for Oryx and turnkey Maintenance, Repair and Overhaul (MRO), which offers the capacity and capability to maintain airborne systems and components for C130, Rooivalk, Oryx.

• Denel Dynamics – missiles, unmanned aerial vehicles (UAVs) and Integrated Air Defence Solutions (IADS), and Denel SpaceTeq10 – satellite systems, missions and oversight of the Houwteq space system assembly, integration and testing facility;

• Denel Overberg Test Range (OTR) – Multi-role guided, and aviation systems test facility, • Denel Land systems – Artillery and infantry systems as well as small arms; • Denel Mechem11 – Mine protected vehicles, war clearance systems, and canine solutions; • Denel PMP – small and medium calibre ammunition; • Denel Technical Academy;

8 This responsibility is limited to Armscor’s role as an acquisition agency on behalf of defence and does not give Armscor any responsibilities beyond its own transactions (Hamilton, 2020) 9 This entity is a metallic and composite airframe component and assembly manufacturer 10 May exit 11 May exit


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• Denel Maritime – Navy support; • Denel Vehicle Systems – Military vehicle manufacturing, and; • Denel Aeronautics – Metallic and composite airframe component and assembly manufacturer

(exiting).

Denel also has a number of equity partnerships, joint ventures and cooperation agreements with renowned international players in the defence industry.

The Alkantpan test facility (Armscor) is an additional crucial industry asset. A second significant entity, from the private sector, is the Paramount Group of companies, consisting of business units working in the following areas:

• Maritime; • Land combat systems; • Advanced technologies, and; • Aerospace systems.

In the late 1990s the sector was bolstered by the defence procurement packages with an emphasis on air and sea capabilities, thus creating a new wave of technological focal areas, sector development support mechanisms and international relationships, as well as the formation of new commercial and defence companies.

3.1.2 Aerospace The aerospace sector in South Africa is predominantly weighted towards the aeronautical side of the sector with a particular emphasis on sub-system manufacturing and assembly. There are additionally some flagship projects in place such as s range of missile programmes within Denel, a wide range of Unmanned Aerial System (UAS) or drone projects (within Denel and private sector companies such as Tellumat and various Small, Micro and Medium Enterprises (SMMEs) and the Advanced High- Performance Reconnaissance Light Aircraft (AHRLAC) which is an Intelligence, Surveillance and Reconnaissance (ISR) and Light Attack aircraft1213 (AHRLAC Holdings - Aerosud and Paramount joint venture). The Small African Regional Aircraft (SARA) project is at risk in part because of problems being experienced within Denel.

At the system development level there is significant intellectual property (IP) that has been developed locally in avionics, optronic systems (laser rangefinders and multi spectral sensors/cameras), electronic warfare (EW) systems such as Identification, Friend or Foe, (IFF), surveillance systems, radar, additive layered manufacturing (3D printing), materials development (Titanium), and continuous fibre reinforced thermoplastic plastic (CFRTP) manufacturing, to name a few. There are also a few well established general aviation aircraft and associated sub-system manufacturers such as The Airplane Factory, and Jonkers Sailplanes amongst others, with newer entities such as Adept Airmotive also participating. South African aviation structural

12 The name AHRLAC for the aircraft will cease to exist by 29 February 2020. 13 As at February 28th, 2020, no decision had been taken regarding the viability of the company, but a decision is expected soon.


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manufactures such as Denel and Aerosud are also single source suppliers of components to both Airbus and Boeing – metallic and composites structures. The local integrators are:

• Denel Group; • Aerosud; • SAAB Grintek Defence; • Paramount Group

The manufacturing supply chain is quite disparate and consists of roughly 30 organisations that tend to do machining and assembly of sub systems for the integrators. They also tend to work in other sectors as well, to ensure sustainability of their businesses. There are a number of international entities with a South African presence and these include:

• Airbus Helicopters and Airbus Defence and Space; • Boeing international; • SAAB Grintek Defence; • Hensoldt; • Thales South Africa Systems; • GEW (Part of Hensoldt);

Saab, Hensoldt and GEW in particular have well established industrial capabilities that form an integral and key part of the South African Defence Industry (SADI).

There are well established regulatory organisations and bodies such as The South African Civil Aviation Authority (SACAA), and Air Traffic Navigation Services (ATNS). Various efforts for targeted support programmes have been made by Government in the past 10 years, notably through the work of the DTIC and the DSI, to support the sector but arguably with limited impact. These include the Aerospace Industry Support Initiative (AISI), the then National Aerospace Centre of Excellence (NACoE) [which since evolved into the National Aerospace Centre (NAC) managed and hosted by the University of the Witwatersrand], the Centurion Aerospace Village (CAV) and the Joint Aerospace Steering Committee (JASC) which was established as a result of the findings of the Aerospace Sector Development Plan (SDP) and with the aim of providing strategic positioning for the aerospace and defence industry in South Africa. The sector is also strongly supported by the following industrial bodies:

The sector is also strongly supported by the following industrial bodies:

• AMD (South African Aerospace, Maritime and Defence Industries Association) – which serves to support the interests of the South African Defence Industry (SADI) by promoting public and private sector interests,

• CAMASA (Commercial Aerospace Manufacturing Association of South Africa) – which has been in operation for 36 months - serves to support and integrate the SA aviation sector, by linking the public and private sectors to boost aerospace manufacturing exports, and;


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• CAASA (Commercial Aviation Association of Southern Africa) – established in 1944 to support and protect the interests of the commercial aviation sector. This association is an umbrella association which contains a large number of relevant associations largely concerned with Maintenance, Repair and Operations (MRO) of aircraft, which is a significant value chain for the industry in the context of job creation and potential transformation.

The South African Aerospace sector has developed a number of highly competitive products using local Intellectual Property (IP) and is capable of significantly expanding on this. The table below offers an overview of some of the more relevant South African developments:

TABLE 2- SELECTED SOUTH AFRICAN DEVELOPED TECHNOLOGIES

Technology IP owner/Producer 3D printing of Titanium (Aeroswift)14 DST, CSIR, Aerosud15 Aircraft Design & integration of systems Denel, Aerosud, Paramount Group Avionics systems Denel. Paramount Group Continuous Fibre Reinforced Thermo Plastics Aerosud Electronic warfare systems Hensoldt, GEW Fuel Cells Sun, UCT, CSIR Helicopter Design & integration of systems Denel, Paramount Group Helmet sighting systems Bae, Hensoldt Laser rangefinders Hensoldt Laser Shock Peening Wits, CSIR Missiles Denel Multi-spectral cameras and gimbals Hensoldt Radar Hensoldt, Tellumat Solid Rocket Motors RDM Synthetic Aperture Radar (SAR) CSIR Titanium Powder CSIR, SUN, CUT Turbomachinery CSIR, Wits, Denel Unmanned aerial vehicles Denel, CSIR, Paramount Group Welding Technologies NMU, Wits

A very high level overview of the Aerospace sub sector is shown below as one example. There are a number of conceptual value chains available, and it will be important to agree and choose the most relevant and constructive for South Africa going forward, once the research is underway.

14 ADC Aeroswift is a Pretoria based company, focussed on metal 3D printing for high-tech applications. They have developed a powder bed metal 3D printer, in collaboration with the CSIR. The Powder Bed Fusion (PBF) process to manufacture parts directly from metal powder. Thin layers of metal powder are sequentially deposited and, based on CAD data, melted using a high power laser. Currently structural parts are under development for use in the A & D industry. 15 Aerosud Innovation Centre was part of the original Aeroswift Consortium


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FIGURE 2- HIGH LEVEL AEROSPACE VALUE CHAIN

Source: NASA, 2018

MRO for defence and commercial aircraft, is a very large and important subsector of the industry, with SAA Technical only one of the three major continental commercial MRO hubs being SAA Technical at OR Tambo International Airport, (the other two are in Addis Ababa and Nairobi), with at least 15 companies providing heavy to light maintenance at OR Tambo and other airports in South Africa (such as Lanseria). This sub sector and possible value chain of interest is labour and skills intensive, and may have the capacity to grow significantly. Investigation of the data in the Situational Analysis will determine the status quo.

3.1.3 Space The Aerospace and Defence industries include Space as a sub-sector, although it is becoming increasingly important in defence, communications, information and big data (4IR). Without Space technology, communications and data linked to defence operations and critical aviation systems would not be possible.

The Space economy includes all public and private factors involved in developing, providing and using space-related outputs, space derived products and services and the scientific knowledge arisen from space research. Some estimates suggest that the total value of the global space-related

https://www.google.co.za/url?sa=i&url=https%3A%2F%2Fwww.slideshare.net%2Fboinyc%2Fcluster-development-policy-for-aerospace-industry&psig=AOvVaw3t1nWjwehJqzVU-sNk9HKf&ust=1571570176711000&source=images&cd=vfe&ved=0CAIQjRxqFwoTCNCEh6SZqOUCFQAAAAAdAAAAABA8


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industry is predicted to grow from approximately US$350 billion in 2017 to approximately US$2.7 trillion by 2047, with South Africa in a position to potentially access elements of global growth.

Growth of this nature is predicted largely because the cost of accessing Space is declining and private sector participation is increasing at a very fast rate. The digital economy demands global and high speed connectivity, driving rapidly increasing demand for space based services and data sets related to communication and remote sensing. Predictions are that at least an additional 6,200 small satellites will be launched between 2018 and 2028. Small launch systems, advanced electronic systems and earth monitoring applications are predicted to grow the fastest to 2022.

The space industry value chain is summarised as those activities i) required to get into Space which include ground equipment, launch equipment and infrastructure, and the manufacturing and launching of satellites and their payloads; and ii) the services that are provided, including data, applications, communications, connectivity, and which provide the means to make these accessible to users.

South Africa has an internationally recognised space industry which spans across the value chain- other than for launch capability- although this is currently being reviewed. South Africa additionally has a well-developed policy and legal framework, with space activities regulated in terms of the Space Affairs Act (Act 84 of 1993). This provides for the South African Council for Space Affairs (SACSA) responsible for the National Space Policy and consideration of international treaties and principles administered by the UN Committee on the Peaceful Uses of Outer Space. A variety of institutions situated in academia, the science councils and industry, have broad competencies in satellite applications, satellite engineering and space science, and all their supporting technologies. The South African National Space Agency (SANSA) was established in line with the National Space Strategy in 2010 to coordinate and implement the national space programme. The existing infrastructure and skilled workforce, both inside these facilities and in wider industry supporting them, allow South Africa to position itself as a regional hub of space science and technology.

South African Space authorities have determined to continue the process of stimulating and catalysing the growth and development of the National Space Sector, with the aim of catalysing this growth to drive reduction in poverty, faster transformation of the economy and higher levels of inclusion. In 2018 the DTIC supported by SACSA initiated the development of a Space Industry Development Framework in order to identify what interventions the State may make in order for stakeholders to take advantage of the prioritised opportunities, means of improved collaboration with other space faring nations, especially on the African continent.

South Africa is well positioned in certain niches and can compete effectively there with the appropriate strategy and implementation plan. Further, jobs and SMME opportunities are growing exponentially in the digital economy, – downstream of Space based information and communications, and of special interest when considering youth employment and entrepreneurship. The county is in the enviable position of having some excellent Space assets which, with partnered investment, could provide another layer of competitive advantage and fast and profitable growth for the Public and Private sectors alike. Downstream opportunities offer most job and SMME creation opportunities in the short to medium term, and have excellent


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potential for immediate gains in transformation. Poverty reduction will be in part a consequence of the availability of information and communications for all, even in remote areas this reducing the digital divide which increases inequality; and the potential for improved resource management due to Earth Observation (EO) information availability.

FIGURE 3- OVERVIEW SOUTH AFRICAN AEROSPACE AND DEFENCE ECONOMY

Source: Denner, 2019

3.2 Policy imperatives In support of the National Development Plan (NDP) the Industrial Policy Action Plan (IPAP) 2018-2020 requires focussed action on the following elements to move South Africa towards the goal of overcoming the triple challenge of poverty, inequality, and unemployment. This is equally in the context of the Sustainable Development Goals (SDGs) to which South Africa is a committed signatory. Building on IPAP, the RIS, which is the industrial policy guiding framework of the 6th administration, has as its core focus:

• Grow the economy. The Aerospace and Defence economy is well positioned to contribute to this via very high value added exports, and IP development, amongst other factors.

• Strengthen efforts to raise aggregate domestic demand - efforts to persuade the private sector to support localisation and local supplier development. The Aerospace and Defence economy is already integrated to some extent to global supplier chains with global firms. This can be increased.

• Step up South Africa's export effort. As above • Create and reinforce policy certainty and programme alignment. There is already excellent

alignment in the industry, but policy certainty and improvements are possible, for example,


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efforts could be made to raise aggregate domestic demand, and to persuade the private sector to support localisation and local supplier development, as well as increased R & D.

• Strengthen ongoing efforts to build a less concentrated, more competitive economic and manufacturing environment in which barriers to entry for new entrants are lowered. Extensive options for SMMEs at tertiary value chain levels in some sub sectors

• Build a stronger system of industrial finance and incentives to support and secure higher levels of private sector investment in the productive sectors of the economy and grow exports.

• Press ahead with technology-intensive, value-adding beneficiation projects which fully leverage South Africa's comparative resource endowment advantage into a global competitive advantage. Aerospace and Defence is not only a very high technology intensive sector in South Africa, it feeds technology capacity into other industries and is largely very high value added.

• Optimise technology transfer and diffusion and, working closely with the Department of Science and Innovation (DSI), further ramp up the effort to commercialise 'home-grown' R&D in key sectors. Aerospace and Defence programmes ensure transfer and diffusion as well as the building of South African R & D and high tech capacity.

• Support the further strengthening of energy-efficient production and carbon mitigation efforts and measures in a manner that allows for sustainable adaptation by all the energy-intensive sectors of the economy.

• Understand, grasp and prepare for the foreseeable effects of the Digital Industrial Revolution and emergent disruptive technologies. The Aerospace and Defence industry is a harbinger of what is possible in 4IR and is already using 4IR tech well ahead of other South African industries. In some sub-sectors, this will result in extensive creation of economic opportunity, especially for young people, and will contribute significantly to transformation.

Overall the Aerospace and Defence industry is better placed than most to contribute effectively to many (not all) of these policy objectives. It is important that note is taken of the major role that geopolitics plays in defence industry export sales.

4. Approach and Methodology 4.1 Approach A Masterplan as defined for this assignment, is a means of developing an agreed, implementable and measurable plan of action which will result in the growth and development of an industry or sector- undertaken by all key stakeholders in industry, government, and organised labour (with the possible addition of investors and other crucial interested parties). In the initial stages, the plan requires that a baseline evaluation of the industry takes place, know as the Situational Analysis, which serves as the agreed platform for moving forward to a shared vision and mission for the industry.

The plan, once agreed, comprises goals, strategies, targets and measurable outcomes, as well as roles, responsibilities and risks. The activities are achievable and time bound. Impact and consequences can be assessed before, during and after goals and targets are met, and where necessary, are adapted. Similarly, should there be substantive changes in the external impacting environment, these too can be factored in, as monitoring and evaluation on an ongoing basis takes place.


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It is important to consider that some subsectors of an industry may be more worthwhile than others in terms of meeting the stated goals and targets, and that in some cases, the external environment will demonstrate extreme barriers which may be difficult to overcome. The Masterplan approach can result in the outcomes articulated by the DTIC as shown above in the purpose of the assignment, but can also, if effectively developed and implemented:

• Encourage investment; • Identify national, regional, and international opportunities (such as entering global value

chains for example); and • Identify opportunities to strengthen cross-sector linkages (such as between

telecommunications and aerospace via satellite technology for example)

Assessment of the ability to encourage investment is heavily linked to the detailed value chain analysis, which will determine the growth and value (and job) creation potential of each of the critical value chains selected for deeper analysis. Where there are clear advantages and opportunities, these link to investment potential (domestic and international) and specific actions are then designed to optimise these. Opportunities to strengthen cross sector linkages have been referred to in the brief preamble, where the cross sector opportunities between defence IP and civil applications for example, and the application of ICT to both defence and non-defence activities, have been noted.

4.1.1 Stakeholder consultation & engagement The concept of integrating evidence gathering with a consultative and engagement process is not new and has been found to be highly effective if well implemented. It serves to:

i. Collect information, ideas, opinions and insights from a wide range of stakeholders to complement the data analysis and secondary research;

ii. Manage expectations and interests effectively; iii. Share essential information of common interest and value to all for whom the topic/process

is important and attain agreement on the key relevant evidence; iv. Provide a constructive space for debate, disagreement, and consensus building; v. Build a shared vision, mission, strategies and goals amongst disparate stakeholders and;

vi. Agree and commit to the contribution of each stakeholder towards meeting the targets in Specific, Measurable, Attainable, Realistic and Timely (SMART) ways.

The focus of this process is to produce shared vision, mission, goals and key strategies for the industrial development of the Aerospace and Defence economy. This requires the identification, mapping and engagement of all stakeholders in the process of ensuring the protection and growth of the industry and its sub-sectors, in order to achieve national goals. Consultation not only applies to industry stakeholders, but to other key entities involved in the process. The Working Group (WG) in consulted by means of reporting at specified points in the process, by means of review and input consultation, and changes made thereafter based on these inputs.

A robust methodological approach is required that will adhere to the minimum standards for stakeholder consultation. Key principles are that the process is:


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• Integrated –all stakeholder concerns, rights, and risks are taken into consideration; • Evidence based- a comprehensive evidence base gathered including options, costs, benefits

and risks. Based on the best available research, data and information presented in a transparent manner;

• Independent- the lead facilitator is strictly independent, is neutral and unbiased, and has no conflicts of interest;

• Transparent- all stakeholders are provided with comprehensive and accurate information not only as a baseline but also in terms of possible positive and negative consequences and impacts and;

• Participatory- a system for ongoing dialogue and discussion is created and implemented.

In sum, the evidence and analysis are of the best available quality, and are provided in a transparent manner to all stakeholders, with the purpose of reaching agreement on how to protect and grow the Aerospace and Defence industry for South Africa, and to determine and agree what each stakeholder group will contribute to the implementation of the Masterplan.

4.1.2 Evidence gathering It is critical that the evidence upon which the Masterplan is based is accurate, comprehensive, relevant, factual and valid. Additionally the Masterplan methodology requires quantitative evidence is used wherever it is available. Essentially the following elements must be included when evaluating the industry to ensure no errors of judgement are made:

• Industry make up and dynamics, global where relevant. In the case of Aerospace and Defence, the industry is global and global baseline data as well as regional and local, will be needed;

• The external context within which the industry operates. This includes political (important in the case of Aerospace and Defence), economic, technical, policy, legal (such as international trade agreements) regulatory and environmental; and

• How and by whom value is created in the industry and its major subsectors.

Once this information is available, then it is possible to identify and eliminate barriers to growth in order of priority and to build strength to take advantage of the most important opportunities for South Africa.

It is important to note that the Aerospace and Defence economy has significant linkages to other major sectors such as ICT and software, electronics and telecommunications. To the extent these industries are themselves functional, they impact on the Aerospace and Defence economy. At the same time, within the Aerospace and Defence economy, there are viable and non-viable sub-sectors, which need to be profiled and listed in order of priority against national and agreed industry goals. An impact assessment is required to be undertaken using the Socio-Economic Impact Assessment System (SEIAS) method approved by Cabinet16 but this is not part of the scope of this assignment.

16 Cabinet decided on the need for a consistent assessment of the socio-economic impact of policy initiatives, legislation and regulations in February 2007. Policies and Regulations that are internally signed by Ministers are also subject to SEIAS.


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4.2 Methodology Three research methods are used simultaneously, statistical analysis, where statistics are available; literature and document review and; intensive and ongoing stakeholder engagement with all relevant value chains and stakeholders at large.

Focus groups will be conducted, and all material reviewed for the overall Value Chain, for the main sub Value Chains, and, for the prioritised sub value chains. Initial interviews with industry experts, and focus groups conducted with AMD, CAMASA, CAASA and other one on one interviews with various stakeholders, suggest that the following initial breakdown will be a valid staring point for evidence gathering. Please note that the final Value Chains to be used in the Masterplan can only be known once the Situational Analysis is complete and the priority Value Chains have been agreed by the WG. They are chosen on the basis that South Africa is or can quickly be competitive17 in the value chain internationally; that there may be a level of domestic demand; that the industry is willing and able to increase productive capacity; and that the markets are of sufficient size and are accessible to South Africa. However, ALL elements of the top and second level value chains will be reviewed in detail before recommendations are made. All recommendations must be evidence as opposed to opinion based.

TABLE 3- VERY PRELIMINARY OVERVIEW OF VALUE CHAINS FOR REVIEW

Level Preliminary Value Chain Top Aerospace and Defence overall (global and

South Africa) Second (sub sector) Aerospace Defence; Defence other;

Commercial Aerospace; MRO; Space Initial areas of interest (tertiary level) Industrial components (selected); Small

Planes; MRO (technical support); Avionics; SAR; EW; Cube satellites; Earth Observation; Drones; Artillery, Route Clearance Solutions, electro optical sensors. complex cameras, gimbals, periscopes, APCs (or the emerging unmanned vehicles? Both?) Others

4.2.1 Stakeholder engagement Stakeholders have more experience and knowledge of an industry than any researcher can have, and this is a rich source of valid and reliable information. Involving stakeholder intimately in strategy development is the most effective known method of ensuring buy-in, and ultimate implementation. The facilitator should be viewed as neutral, without conflict, and trustworthy. Stakeholder engagement and facilitation of transparent and outcomes based discussion around the provision of relevant evidence, is a core competency of Blueprint’s. The following steps are applied, inter alia, in the design and set up of the process:

17 Includes technology, scale, access, cost


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Step one- identify and map stakeholders

Determine the identity and aspirations of stakeholders and undertake stakeholder analysis in terms of power, interest and alignment. A stakeholder analysis consists of weighing and balancing all of the competing demands linked to the topic, by each of those who have an interest in the outcome. A stakeholder analysis does not preclude the interests of any stakeholders overriding the interests of other stakeholders affected, but it ensures that all affected will be considered.18

Step two- develop engagement strategy

The scope and boundary of the stakeholder engagement policy should be clearly defined, articulated and communicated. The frequency, methods and channels of engagement are finalised. This is particularly important in the Aerospace and Defence Masterplan where there are very high levels of confidentiality required, and major global and local vested interests. State security is an over-riding concern. This is likely to reduce the number of public or semi-public workshops, and increase the need for one on one, or closed workshops.

Step three- implement engagement strategy

A series of meetings of various types are implemented over the period, in stages. At each stage, the findings are shared, and interpretations invited, and agreement sought on the findings and what they mean for the stakeholder/s being consulted.

Step four- ensure regular feedback

Regular feedback into the Master Planning evidence gathering process as well as to the stakeholder groups is required and is implemented in a scheduled manner, ensuring privacy, secrecy and research ethical concerns are applied.

The list below is not comprehensive, and a base list has been collated and sent to the Working Group participants for review and input. This list will continue to be updated during the course of the process.

TABLE 4- INDICATIVE LIST OF STAKEHOLDERS FOR CONSULTATION

Type of Stakeholder Examples of Stakeholders State & State owned Enterprises (SoEs)

Govt (e.g. DTIC, DoD, DPE, DoT, DTPS, DHEST, NT et al) SOE (e.g. ARMSCOR, SANSA, CSIR, CAA, ATNS, Sentech et al)

Academic Tertiary institutions : CPUT, UKZN, UWC, UCT, Wits and more

Industry The key associations, including AMD, CAMASA and CAASA Airbus, Boeing, Aerosud, Epsilon, AAT Composites, SAAB Grintek Defence, BAE Systems, Tellumat, Rheinmetall Denel Munitions, Paramount Group , Reunert, Altech, Grintek, Hensoldt, SafAir, OTT, GEW, DCD, Parcec and others

18 DeGeorge, R.T. (2010). Business Ethics. Pearson Education, Inc. p. 192.


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Type of Stakeholder Examples of Stakeholders Relevant SMMEs including the Airplane Factory, Adept Airmotive, DeltaV Aerospace, S-Plane Automation, Jonkers Sailplane, TiTaMed, Daliff Engineering, Simera Group, Amaya Space, NewSpace Systems, CubeSpace, SCS Aerospace Group, Luvhon, and others. Industry support mechanisms, including: AISI, NAC, CAV, JASC

Other PIC, IDC, DBSA & similar relevant. Organised Labour Regulatory bodies and entities including The South African Civil Aviation Authority (SACAA), and Air Traffic Navigation Services (ATNS), Independent Communications Authority of South Africa (ICASA).

The outcomes of a well-designed and managed stakeholder engagement process, within which information is shared, agreements can be reached, and commitments are made, will be an agreed Masterplan with SMART goals, secure commitments, and a measurable action plan. Stakeholders will buy in in practical and implementable ways.

4.2.2 Research and analysis The process of gathering evidence involves qualitative methods such as stakeholder consultation, document and literature review and other similar processes. It also involves quantitative data gathering on the critical elements and measure which i) can determine ability to compete and ii) can determine ability to contribute effectively and sustainable to the goals of the Master Plan process, the RIS and the NDP. In some cases, where data are not available in sufficient depth, qualitative expert comment will be used.

Blueprint will make use of one on one interviews, consultations. workshops, literature review, case studies, and statistical and financial analysis (to the extent it is necessary and possible) for specific deliverables. Action research, in that the research is grounded in a consultative process, is an essential fundamental of the approach. Because some findings are likely to impact others, during the research and analysis phase a level of iteration can be expected, which will resolve at the draft final report level. For example, stakeholder consultation may add specific issues into the mix for analysis that change some recommendations. There will be overlap and, in some cases, parallel activities, which will be shown in the detailed workplan upon beginning the assignment.


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The research process is dynamic and iterative and as such, sometimes later events inform earlier findings. Some elements of interim reports may therefore change in the final recommendations. Where this occurs it will be noted. The following will be used (although may not be limited to these): - Secondary research – document review; literature review19, case study review, statistical

review; - Primary research- interviews, workshops (where allowed) and discussions - Analysis

o External environmental analysis; o Industry analysis; o Value chain analysis (main and major sub chains) and;

- Impact assessment for stakeholders (high level)

The following steps are implemented, noting again that high levels of iteration can be expected as evidence gathering occurs in the context of a dynamic process. Thus only the final Situational Analysis and Masterplan will remain unchanged/

FIGURE 4- HIGH LEVEL STAGES & TIMING

Source: Trade and Industry Policy and Strategy and the DTIC (2020)

19 While there are a number of useful and relevant reports, such as the white paper on defence, the national telecommunications strategy and others of that ilk, currently some are classified, and permission will need to be sought to view them

• Global & Local• Key performance indicators-

employment, trade, local content, contribution to GDP, technology et al

• Value chains• Stakeholder mapping and extensive

engagement

BaselineStatus Quo Analysis

Four months

• Case study countries• South African• Extensive stakeholder engagement

Case Studies & comparative policy & international agreement

reviewTwo months

• Scenarios • Options • Priorities• Commitments to action (SMART)• M & E• Very extensive stakeholder engagement-

stress test actions• Final high level dialogue

Master Plan BuildingFour months


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Based on the national policy imperatives, the main areas for evaluation and action agreement will be markets, policy support, competitiveness improvement, value chain dynamics (global, regional and local) and any other highly relevant factors- in this case, telecommunications capability, electronics, ICT, software. security and international agreements. An overview and explanation of some of the basic central research methods is tabled below. Blueprint anticipates all of these and more will be utilised in the Masterplan development process.

TABLE 5- RESEARCH METHODS USED

Focus Method/s Desired results Situational Analysis Literature review

- Overview of global and regional trends (PESTEL)

- Detailed review of South African industry

- Extensive use to be made of existing literature base available

Statistical review - Review of data available

Case study/ies (best practice) Interviews one on one Analytical tools such as PESTEL, SWOT and others applied to data

Complete and thorough evidence based as-is analysis of the current status of the South African Aerospace and Defence industry Engagement with key stakeholders in building shared vision and goals Expert input to the analysis, strategy and plans

Consultation & engagement One on one interviews with key stakeholders, stakeholder mapping and analysis, working groups

Will implement a process of stakeholder engagement, involvement and orientation Will provide a shared industry vision Will provide critical inputs for a number of deliverables

Development of Master Plan & associated plans

Provision of a viable Master Plan framework for the Aerospace and Defence industry in South Africa Master plan population Logical implementation plan with SMART 20 goals and timeframes Logically linked M & E plan

A Masterplan which offers shared vision, pragmatic and realistic way forward with a win-win approach and benefits for all Specific plans for implementation which can be monitored, evaluated, and changed.

20 SMART = Specific, Measurable, Achievable, Realistic and Time bound


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To summarise, the research will gather and collate and analyse reliable, valid and relevant evidence, using qualitative and quantitative methods, in the context of a process of stakeholder engagement conducted with neutrality and integrity, to arrive at an agreed industry Masterplan with SMART goals, and firm commitments for action from all stakeholders.

FIGURE 5- OVERVIEW TIMING

The research process is dynamic and iterative and as such, sometimes later events inform earlier findings. Some elements of interim reports may therefore change in the final recommendations. Where this occurs it will be noted. 4.2.3 Scope of Work & Deliverables The scope of work is outlined in the Service Level Agreement (SLA) as is as follows:

• Comprehensive review of the South Africa A & D value-chain present position and policies so as to establish a sound empirical picture of the sector which all stakeholders can agree to.

• Complete a SWOT or similar assessment of the sector based on extensive consultation with industry stakeholders, experts in associated local or international research organisations, and up/downstream value-chain participants. The SWOT must locate the South African industry in a global context and draw lessons from international successes.

• Convening focused stakeholder meetings/workshops to assess and strengthen the analysis of the sector, and ultimately reach agreement with stakeholders on a joint vision and mission statement for the sector.

• Propose draft programmes for time-bound, collective action (by industry, government and labour) to achieve the vision for the sector. It is crucial that stakeholder buy-in and active support for the actions is obtained.

• Develop policy and regulation recommendations for government. • Develop time-bound, development targets for industry and labour

Situational Analysis

Week 2-16Full desk researchInterview schedules and toolsInterviews, one on oneSituational analysis complete to draftinterviews undertakenSITUATIONAL ANALYSIS REPORT

Consultation

Week 16- 20Desk research and consultation continueBegin draft M & E planBegin draft MasterplanOngoing group engagements to present findings

Guidelines & Action plan

Week 20-26Final consolidationFinal draft strategy and plans tabledHigh level dialogueFinal strategy and plans deliveredClose outFINAL REPORT


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• Propose an appropriate institutional structure/s to drive implementation of the Masterplan. • Package the baseline, SWOT analysis and draft Masterplan into a narrative report and

presentation for use by stakeholders. The deliverables have been defined as follows and are shown below with a brief description of each component.

TABLE 6- DELIVERABLES TABLE

Deliverable Content Description Inception report Scope of work, deliverables,

timetable, workplan and team The research plan is described, a broad rationale as to the need, and the team is introduced. Sign off of the workplan includes dates for delivery. Report does not include research.

Situational analysis Draft report (10-20 pages) which describes nature of the value-chain, the key value chain players and high-level data covering (inter alia) employment, value-addition, investment, exports, imports, productivity metrics, input prices, consumer demand, and high-level outlook (including global outlook), and a SWOT analysis covering all the main sub-sectors or value-chains.

This is data driven, and the measures required are social and economic. No primary research is required, but a review of all existing literature is needed, all existing relevant statistics, and inputs from ongoing consultations with experts.

Consultation report This records and analyses the outcomes of all consultations to the date of delivery, and records non private data of those consulted

This is a short report outlining who has been consulted, and providing a short qualitative analysis of main themes and outcomes, and vision for the industry.

Draft Master plan structured as per agreed template/outline

Template provided in Annexures. A short, succinct document that has been agreed in principle by the industry (government, organised labour and private sector)

This is a short report, required to be very succinct, which consists of a short rationale for the recommendations contained, and which provides clear tables containing main pillars for action, actions required, responsibilities and roles.


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Deliverable Content Description Once approved, a detailed action plan for each item is development and an M & E plan developed for each sub action

Final Master Plan Adaptations to draft as determined by the WG

Final Master plan approved by WG. Once approved, a detailed action plan for each item is developed and an M & E plan developed for each sub action

4.3 Tools The mixed methods research approach requires the use of a number of different tools. For this assignment, the list of tools is outlined below, but may not be limited to these alone as additional tools may be required.

4.3.1 Situational Analysis A detailed profile of the status quo of the South African A & D industry is developed as the evidence base using available data, and the most recent data from reliable sources. From the external environment perspective, a PESTEL21 analysis is undertaken. It is a framework analysis of macro-environmental factors in an evidence based scan used for strategy development. Understanding the context within which the sector operates, and how this compares to best relevant practice, is the precursor for the development of the industry analysis, which assesses (again evidence based) the micro dynamics and economics of the industry under review, as well as providing inputs to competitor analysis. Limited macro-economic analysis at the macro and industry levels provides useful trend analysis to inform direction.

This is a review of all factors, inside and outside the sector and industry, which impact on performance and define the current reality and includes a SWOT22 analysis. Accompanying this is a value chain analysis for the industry overall, but also for main sub sectors, where more detailed value chains can provide insight into variations which may prove susceptible to constructive intervention to improve productivity and ultimately, competitiveness. Case study work offers the opportunity to compare South African policy and practice, and industry structure and costs, to those of relevant and comparable regions. Interviews with experienced people provides depth and insight not only into the industry, but into potential interventions with higher chances of success, which can be reality checked prior to the development of the Masterplan.

The combination of quantitative data with interviews will provide a better understanding of the factors that are currently preventing companies from performing more competitively.

21 PESTEL = Political, Economic, Social, Technological, Environmental and Legal 22 SWOT = Strengths, Weaknesses, Opportunities and Threats


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4.3.2 Consultation While the situational analysis will provide a clear and detailed evidence based analysis of the sector and sub sectors, detailed insights, which are only available from industry stakeholders, are needed to inform the final outcome. A series of interviews, and possibly five to ten workshops with key stakeholders will ensure that these perspectives are part of the final A& D Masterplan for South Africa (ADMSA). All consultation will include discussion on at least the following topics:

• Review of Situational Analysis; • Review of Value Chain recommendations; • Vision, mission, shared goals; • Discussion of the situational analysis, additions, refinements, changes; • What are the opportunities in order of priority? • What might constitute a good shared vision of the future of the sector be that all stakeholders

can buy in to? • What might a constructive and achievable Masterplan for the industry look like? • What does success look like? • What happens if we are not successful?

4.3.3 Development of guidelines and action plans Once the information has been consolidated, a framework of the contents of the proposed Masterplan and implementation and M & E plans will be tabled for approval. Once approved, the Masterplan will be populated and checked, and the draft provided for review. When all input have been concluded, the final Masterplan will be submitted, with the draft implementation and M & E plans. Once these have been approved the close out report will be prepared, and the project file submitted.

4.4 Process overview The research is conducted in the context of a consultation process which seeks to achieve a shared vision for the future and consensus regarding opportunities and necessary strategies and action for the local industry. The consultation process also represents a type of action research, with interviews, work with the Working Group, and the high level dialogue providing ongoing inputs for the research, as well as useful reality checks for outcomes, findings and recommendations.


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FIGURE 6- PROCESS OVERVIEW

This means the research and design process, as well as the development of the final ADMSA is likely to be an iterative and dynamic process which cannot be fully captured in linear planning terms, but which will generate the best outcome for the project.

4.5 Outputs The outputs from the assignment are the Masterplan, an implementation and action plan and a linked Monitoring and Evaluation plan. The Masterplan format is shown below. It encompasses, inter alia, a vision, mission and objectives, which are supported by cross cutting and transversal activities.

FIGURE 7- MASTER PLAN FORMAT23

23 Source: TIPS & DTIC, 2019


Consultation and revision, development of preliminary Masterplan

ADMSA and plans preparation and validation

TestingDrafts submitted

Final ADMSAFinal implentation planFinal M & E plan

Interviews + desk work

Plans preparation Validation Dialogue Interviews

Workshops Documents

Working Group Final


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The master plan is supported by an action and implementation plan, which provides the detail for each key objective, indicating the strategy/ies, goals, tasks, deadlines, measures and responsibilities for action.

TABLE 7- ACTION & IMPLEMENTATION PLAN- EXAMPLE

This is accompanied by a clear workplan timeframe, expressed in a timeline GANTT format, which will be provided for adaptation and change by those responsible for implementation planning. Examples of the format are shown below.

FIGURE 8- EXAMPLE GANTT IMPLEMENTATION TIMELINE

The implementation plan is linked to an M & E Plan, so that outcomes can be measured, and adaptive measures taken as needed. The Department of Planning, Monitoring and Evaluation (DPME) unit in the Presidency monitors progress monthly and feedback to the Public Private Growth Initiative (PPGI) from the industry Working Group is expected on a regular basis.


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FIGURE 9- SAMPLE MONITORING & EVALUATION PLAN

5. Project Management The Blueprint approach provides an overarching management function through effective project management and core work undertaken by Blueprint key experts with experience of similar projects and with the necessary skills and expertise. The benefits of this approach are outlined below. Blueprint uses the PrINCE 24 approach to project management for all assignments. The management function:

• Ensures delivery of consistent high-quality outputs through effective project management; • Offers an effective interface between the project brief and the client and the key experts; • Adds value throughout the delivery process; • Guarantees performance; and • Ensures that a good understanding of the requirements is translated into the required outcome.

The key experts proposed have strong track records from a number of relevant perspectives as can be noted from their CVs and are able to conduct the appropriate research, review and provide recommendations based on their experience. All members of this core team have worked together on many successful projects and we believe this combination combined with meticulous technical management and quality control and high levels of communication, will lead to the desired outcome for this assignment.

5.1 Project Risk Profile The key project risk is linked to permission being granted for access to essential documents and statistics. The issue will emerge as to what, and how, such information can be shared. The technical experts and lead facilitator have all been security cleared in the past, with Philip Haupt, Linden Petzer and François Denner granted top secret clearance. This has been allowed to lapse as such clearance has not been required but we do not anticipate problems in reinstating clearance for the entire team if needed. Timely feedback will be of the utmost importance in all engagements with the Working Group. Delays in critical communications feedback will push out the project time to delivery.

24 Projects In a Controlled Environment ©


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5.2 Responsibilities of the client • The client will provide a letter of introduction to confirm Blueprint’s appointment as service

provider; • The client will facilitate access to all relevant literature, documents and statistics needed for

the assignment, as soon as possible after inception; • The client will provide a preliminary list of stakeholders it wishes to be involved, Blueprint

will update and add to this list; • The client will provide a liaison person for Blueprint to work with on a day to day basis as

needed; • The client will facilitate security clearance procedures, and all necessary formal permissions,

for the team, as needed.

5.3 Project Planning- Timeline The project is to be completed within ten months. Preliminary dates for submission and presentation of deliverables are shown below, followed by the more detailed workplan.

TABLE 8- PROPOSED SUBMISSION AND PRESENTATION DATES 25

Item Report to WG for pre reading

Working Group Meeting

Report Revisions submitted & signed off

Report submitted to DPRU

Inception report

N/A February 13th February 23rd February 29th


April 1st April 16th April 15th April 17th

Consultation report

April 28th N/A May 5th (round robin) May 7th

Draft Masterplan26

June 9th June 16th June 23rd June 25th

Final Masterplan27

June 30th July 7th July 14th July 28th

The proposed timelines and activities for the work are illustrated in the high-level project plan below. Months and weeks are numbered but once the final dates as proposed above are confirmed by the Working Group, we will date the workplan and send it as a separate document.

25 To be confirmed by WG 26 Not yet confirmed 27 Not yet confirmed


Page | 33 - Final

FIGURE 10- WORKFLOW & PLAN


Page | 34 - Final

5.4 Project resourcing For this assignment, Blueprint is providing an impartial and experienced facilitator with sound knowledge of the sector (Josie Rowe-Setz); three essential senior technical experts in Aerospace, Space, Defence, and Telecommunications) (François Denner, Philip Haupt, and Linden Petzer) and two engineering and manufacturing specialists in aerospace and space manufacturing and satellites (Jessie Ndaba and Khalid Manjoo). This team has worked together before, on the development of the Space Development Framework for South Africa, in 2018. Gordon Freer, a M & E specialist, will be brought in once the Masterplan has been completed, to undertake the M & E plan.

Blueprint has also arranged that additional expertise and support will be available to the core team in the preparation and review of all material. Bertholdt Alheit, who has had over 40 years’ experience in South African defence, Des Barker, SA Air Force (SAAF) major general (rtd), Tsepo Mohaneng, ex Denel, and Mothobisi Zondi, will peer review all material and research parameters from the defence perspectives for the internal team prior to final submission of material. They will also provide advice and guidance in their areas of expertise. If additional expertise of a specialised nature is required, we will identify and call upon specific experts from the industry, as and when needed.

This team is supported by an appropriate logistics coordination, administration management and research staff complement. The suggested team has extensive experience in economic, industry and sector research and considerable expertise in information assessment, collation and review, as well as stakeholder engagement and management. It is a team experienced in all main aspects of the Aerospace and Defence Industry. The research and logistics support team is well qualified and experienced in working with the senior experts.

5.5 Project Team

TABLE 9-PROJECT TEAM

Name Qualifications & Experience Assignment Role Bertholdt Alheit BSc Eng, , B Com, MBA

• Early years with CSIR; followed by 20 years with Kentron focusing on weapons systems, optronics, & digital control systems

• 19 years following Kentron with Denel

Peer review of all Defence (weapons and other) related material and research design for project team.

Tsepo Mohaneng BSc Eng, BSc Physics/Mathematics, MBA • Kentron, 2002-2004

(UAV systems)

Peer review of all Defence related material and research design for project team.


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Name Qualifications & Experience Assignment Role • Denel Aerospace

Systems – 2004-2012 • Denel Dynamics –

2012-2017 • Safcol, 2017- 2020

Des Barker (Major general Rtd)

Pilot, maintenance test pilot and experimental test pilot. Qualified flying instructor and display pilot. • Chief Test Pilot SAAF

(1990-1995) • Officer Commanding

(1996-2000) of the SAAF Test Flight and Development Centre.

• Air Attaché to the United Kingdom in 2000 and Base Commander AFB Makhado.

• Chief of Air Staff Operations (to 2008)

• CSIR Manager Aeronautics Research 2008- 2017

Peer review of all Defence (aviation related) material and research design for project team.

François Denner MDS, B. Ing • A member of the

Aerospace team overseeing inputs on behalf of the aviation and space industries into the Public Private Growth initiative (PPGI) with aim to facilitate investment and accelerate economic growth;

• 25 years’ experience in Space and Defence

• Technical advisory services to the United Nations Industrial Development Organisation (UNIDO)

Technical expert-Space & Defence • Supported by Khalid

Manjoo and Jessie Ndaba


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Name Qualifications & Experience Assignment Role in the inception phase of the West African Competitiveness Programme, Ghana component.

Freer, Gordon/ Carmen Möllman

• M.A. & Post grad Monitoring & Evaluation/M Com

• Wide and deep international and local M & E experience and expertise

Monitoring and Evaluation Plan • Full plan based on Master

Plan • SMART principles

Jessie Ndaba B.Sc. Eng., Electrical Engineering & Satellite Engineer • 10 years’ experience in

development of Space Solutions

• African Space Youth Forum

• SMME development

Technical Expert Satellite & Space • Space Business planning • Commercialisation of

innovation in Space • Youth and transformation

in Space sector

Khalid Manjoo BSc Eng., Electrical Engineering & Post Grad International Space University • Five years in Middle

East setting up Space satellite fleet for launch

• Extensive AIT expertise • Space information

systems & software engineering

Technical Expert Satellite & Space • Space and Aerospace

information systems • Standards and verifications

Linden Petzer N Dip Electrical engineering & Post Grad electromagnetic capability • Ex Chief Director Radio

and Satellite Communication Department of Telecommunications & Postal Services

• Technical expert- Aerospace and Defence ICT infrastructure, policy and regulation


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Name Qualifications & Experience Assignment Role • Member of the South

African Council for Space Affairs

Mothibisi Zondi MSc Mech Eng; MSc Logistics Management; MSc Transport Management, MBA, PhD Mech Eng • Department of Defence.

Chief Defence Matériel. 2008 to 2018

• Advisor to Minister of Defence on armaments acquisition

Peer review of all Defence commerce and linked material for project team. Inputs to research design.

Philip Haupt BSc (Hons) Computational and Applied Mathematics, PhD in progress • 31 years’ experience in

the aerospace and Defence sector

• Extensive local and international experience in technology development, industrial development and R&D

• 20 years’ experience in the development of sector strategies, industrial road-mapping and technology incubation

Technical expert –Aerospace and Defence • Supported by Linden

Petzer

Rowe-Setz, Josie

MSc, MAP • Complex national

facilitation process design and implementation;

• Member of the Masterplan Steering Committee;

• 25 years of experience in design, management and quality control of

Team Leader: • Facilitator – stakeholder

engagement process • Research design and

oversight • Specific analysis


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Name Qualifications & Experience Assignment Role research and policy assignments in the public sector

• Excellent knowledge of South African policy environment & public and private procurement policies and practice;

• 25 years of experience in applied social science research;

• Extensive local and international experience in the development of industry strategies, sector strategies, roadmaps and clusters, across a wide range of South African sectors

Song, June/ Thabani Madida

BA (Hons) (both) Economics and History • Extensive logistics and

organizational experience. Research support

Logistics and project organisation • Stakeholder engagement

logistics and administration

• Document and literature collations and lists

• Stakeholder engagement diary management

• Workshop support

5.6 Project Governance The Masterplan process is reporting ultimately and directly to the Presidency. 15 core sectors have been chosen as the priority sectors for 2019/2020 to undergo the process and develop actionable plans. The approach and methodology is pre-determined (although there is some flexibility within the framework). As noted earlier in this inception report, the purpose of the Masterplan process is the development of priority actions (agreed by Business, the State and Organised Labour) which will fast track growth in the sector in the immediate term, but equally importantly, set up an ongoing discussion forum at the highest level for the three parties to continue the process of shared planning on an ongoing basis. The governance structure is as follows:

FIGURE 11- GOVERNANCE STRUCTURE- MASTERPLAN PROCESS (CURRENT)


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The PPGI team along with the DPME and the DTIC are engaged with the oversight and support of all Masterplans. The President meets with the teams monthly to review progress and to ensure that progress is being made towards agreed goals, as well as to determine if any intervention is needed to support the critical path towards agreed goals.

The Executive Oversight Committee is made up of the lead Minister for a specific sector masterplan, her/his DG, the CEOs of the main firms involved, organised labour and any other relevant person. The EOC is charged with ensuring that the agreed actions are implemented, and will often set up task teams headed by a member of the EOC, to oversee implementation.

Before the EOC can implement the Masterplan, it must be agreed by the social partners, and this is the main purpose of the Working Group (WG) which oversees and guides the work of the technical consultant and facilitates final agreement of the Masterplan. The WG will eventually present the agreed Masterplan to the EOC for implementation. Members of the WG will be senior level stakeholders with a significant interest in the sector , from government departments and agencies, to private sector associations, and organised labour. These representatives are empowered to represent their respective constituencies and will have the authority to make commitments on behalf of their stakeholder constituencies. The WG reviews the main outputs of the Masterplan process (situational analysis, consultation report, masterplan, action plan and Monitoring and Evaluation (M &E) plan), and approves the final versions.

Drawn from industry and the WG, are individuals with specific industry/sector expertise which is considered useful for the technical consultant – where the consultant may need ongoing access. This is often called the Industry Reference Group (IRG), and it is typically small, able to provide ongoing inputs to the technical consultant, and easily available. The IRG reviews the technical


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work prior to the presentation of the final draft to the WG so that the WG can focus on decision making linked to the outputs rather than technical issues.

The technical consultants are provided with an approach and methodology which has been developed by the DTIC and others (as described above), and are required to provide an evidence based profile of the sector/industry, with specific indicators and descriptions, as well as to use specific tools in the analysis. Based on the evidence, a number of priority actions designed to unblock, and fast track industry growth should be identified, quantified and agreed. The research and Masterplan development must take place within a process of meaningful consultation, so that the final Masterplan achieves buy-in from all parties, thus allowing implementation of evidence based priority growth options to take place.

The DTIC is the funder of the Masterplan development process, and the contract with the technical consultant is administered by the DPRU of the University of Cape Town.

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Annexures Annexure one- Documents and data for review The following list is not complete as it will continue to be built during the course of the work. It provides a sample of the documents currently collected (total of 194 at this time). The final list will be provided with the final report, but as usual, reference cited in reports will be included in the reference list. As well as the document sources data bases such as Quantec Easydata, TradeMap and the SIPRI arms transfer data base, inter alia, are used.

TABLE 10- SAMPLE DOCUMENT REVIEW LIST

Document title Date Author/Publisher 2019 Position paper on the South African Defence Industry

2019 Hamilton, L.S. AMD

Aeronautical research in South Africa. Historical Incentive to go forwards.

N.D. Maj Gen Des Barker (SAAF Rtd)

Aerospace & Defence in a developing country

2009 Beeuwen Gerryts CSIR

Aerospace & Defence trends

2018 PwC

Aerospace capabilities South Africa

2009 SANDF/AMD

Aerospace SDP Framework (rev 3)

2011 CSIR

AMD position paper on DIDS

N.D AMD

Armoured Vehicles Market Report

2014 Defence IQ

Arms acquisition- why is it so difficult?

2011 Hult, G Department of Military Technology National Defence College Sweden

Armscor Business Development Framework

2017 Armscor

Commercial aerospace industry development strategy

2019 The DTIC

Consolidated inputs for PPGI

2019 AMD/SADI

DEVELOPMENT OF SOUTH AFRICAN A & D MASTER PLAN

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Document title Date Author/Publisher Defence 101”- Overview of Canada’s Defence and Security Industries

2018 CADSI

Defence capability- trends and predictions

2015 Frost & Sullivan

Defence Industrial Policy Paper No. 5

2010 Ministry of Defence UK

Defence Industrialisation Policy (DIP)

2015 Armscor

Defence Industry 5 year business plan (2019-2024)

2019 AMD

Defence industry strategy 2017 National Defence Industry Council

Defence sector body relationships

2010 CQI defence interest group UK

Defending Australia in the Asia Pacific Century – Force 2030

2009 Australian Government

Final internal audit report, NIPP Performance review, Strategic Defence Package

2014 the DTI Internal Audit Chief Directorate

Five Megatrends and their implications for global defence and security

2016 PwC

Foreign Military Sales White Paper

N.D. US government Security Cooperation Programme (SA)

Future of the Kenyan Defence Industry. Market Attractiveness, Competitive Landscape and Forecasts to 2020

2019 Strategic Defence Intelligence

G2G Contracting Framework: SADI inputs

2018 AMD

Geographic assessment for aerospace manufacturing investment (ranking)

2017 PwC

Global A & D Sector Outlook

2016 Deloitte

Global A & D Sector Outlook

2018 Deloitte

Global aerospace and defence sector outlook

2017 Deloitte


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Document title Date Author/Publisher Growth prospects remain upbeat Industrial defence strategy for the aerospace industry in South Africa- Global Aerospace Market Analysis

2016 Frost & Sullivan

Innovation Instruments in South Africa

N.D. AMD

Landward & Naval capabilities in South Africa

N.D. AMD

National Space Development Framework

2018 Blueprint

NIP Guidelines 2014 The DTI Overview of Defence industry trends global and local

2019 SAAMDEC

Position paper: Request for designation of small arms and ammunition

2019 Armscor

Securing prosperity- a strategic vision for the UK defence sector

2014 Defence growth partnership UK

South African Aeronautical Industry Development Study Part one. Survey & Critical Analysis

2019 CSIR

South African Aeronautical Industry Development Study Part two. Strategic Growth plan

2019 CSIR

South African Defence Industry Customised Sector Programme

N.D. The DTI

South African Defence Review

2014 Department of Defence

Spanish system of government to government agreements

2017 Spanish Ministry of Defence

Study, Segment 1, MS1 and MS2•

2012 AMD/SADI

Technology Trends in the Defence & Aerospace

N.D. Bouchekua, M. Tawazun Economic Council


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Document title Date Author/Publisher Sector that will significantly change the sector The economic contribution of BAE systems to the UK Economy

2008 Oxford economics

The Rooivalk Attack Helicopter A review of the project’s impact.

2014 Department of Public Enterprises

Top ten risks in Aerospace & defence

2019 Ernst & Young

Towards a European Defence Market

2008 Institute for Security Studies

UK approach to unmanned aircraft systems. Joint doctrine note 2/11

2011 Ministry of Defence

UK security survey 2012 ADS Working Group Report Technology Development, Demonstration, and Commercialization

2012 Aerospace Review (ca)


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Annexure two- Stakeholder list for consultation selection (refer separate Excel workbook attached to this report)


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Annexure three- Situational Analysis Draft ToC28 EXECUTIVE SUMMARY THIS REPORT STRUCTURE OF THIS REPORT LIMITATIONS OF THIS REPORT 1. BACKGROUND 1.1 MASTERPLAN PROCESS-OBJECTIVES 1.2 OVERVIEW OF APPROACH & METHODOLOGY 1.3 BRIEF 1.4 A & D DEFINITION & DATA 2. GLOBAL BACKGROUND 2.1 GLOBAL ECONOMY 2.1.1 IMPACT ON EMPLOYMENT 2.1.2 IMPLICATIONS FOR THE A & D INDUSTRY 2.2 GLOBAL A & D PRODUCTION & TRADE 2.2.1 PRODUCTION 2.2.2 TRADE ERROR! BOOKMARK NOT DEFINED. 2.2.3 Trade balance 2.2.3.1 Africa, the Southern African Development Community (SADC) and South Africa 2.2.4 TRADE PROTECTION 2.3 A & D PRODUCTION PROCESS AND TECHNOLOGY 2.3.1 ELECTRONICS 2.3.2 SPACE 2.3.3 AERO 2.3.4 MARINE 2.3.5 ORDNANCE 2.4 MAJOR TRENDS IN THE A & D INDUSTRY 2.5 CASE STUDY ONE 2.6 CASE STUDY TWO 3. SOUTH AFRICA 3.1 SOUTH AFRICAN ECONOMY 3.1.1 SOUTH AFRICAN A & D ECONOMY 3.2 SOUTH AFRICAN A & D SECTOR 3.2.1 CORE POLICY 3.2.1.1 Public & Private Policy & Procurement 3.2.2 INDUSTRY PERFORMANCE OVERVIEW 3.2.3 VALUE CHAIN/S 3.2.4 INDUSTRY FORCES 3.2.5 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS 3.3 INPUTS TO THE INDUSTRY/ BARRIERS TO GROWTH 3.3.1 One 3.3.2 TWO 3.3.3 THREE 3.3.4 FOUR

28 This may vary and is tabled as an example taken from previous Masterplan Situational Analyses


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3.3.5 CAPITAL 3.3.6 IP 3.3.7 LABOUR 3.4 PRODUCTION 3.5 TRADE & PRICING 4. NEXT STEPS- FINAL PHASE 4.1 TIMETABLE 5. ANNEXURES 5.1 BIBLIOGRAPHY 5.2 INTERVIEWS 5.3 DISCUSSION FRAME 5.4 Stakeholder Map


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Annexure four- Masterplan draft ToC 1. Introduction 2. Overview and background analysis 3. Urgent challenges facing the sector 4. The pillars for action 5. Actions & implementation plan 6. Monitoring and evaluation plan 7. Annexures and signatures Note that the final Masterplan provided for the Minster is a short, succinct document. However, all back up information, analysis and evidence are provided as inputs for the Working Group in a separate set of documents.


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Annexure five- locating key sub value chains The A & D Masterplan will table a high level value chain for the entire industry. However, it is unlikely that this will be useful in terms of what the Masterplan wants to achieve, as the industry is complex and highly integrated globally and locally and priorities for action for the South African industry must be quickly identified. This means that it is necessary to identify sub value chains, where there is real potential for growth in the shorter term and focus on a small number of these. Initially, a base classification of the main sub sectors in the industry will be developed using the literature and inputs from the producers, buyers and distributors. There are various approaches to developing a taxonomy which will be useful for Masterplan purposes, some are shown below. Approaches include 1. Classification by type of product 2. Classification by type of activity 3. Classification by spatial means 4. Classification by technology 5. Classification by location on main value chain 6. Other However, within each classification there are further specifics which require more detailed examination and the team will drill down in a number of iterations, being guided by the IRGs and producers, developers and users of the goods and potentially, services. The international and domestic literature reviews will allow shortlisting of the priority value chains, which will be tested with the IRGs and peer review experts, and in particular will be assessed against the ability of South African based entities to compete in global and regional markets. It will be important to ensure that the value chains can speak to the socio economic goals of job creation, poverty elimination, and transformation as well. Identification and assessment of key market segments will be undertaken and linked to the value chains. Once these are decided, the deeper analysis of the short listed chains (limited to four for this assignment) will be implemented. The key areas for investigation are the various stages of a product’s production, distribution and sale, from raw material procurement to final purchase by end-users, in the context of a competitive environment and either an enabling or disabling external environment. At each stage, market participants experience unique cost and price considerations, and perform activities that add value above the material and labour inputs utilized, yielding varying gross profit margins. An example of the ice cream industry chain is shown below.


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FIGURE 12- ICE CREAM INDUSTRY VALUE CHAIN


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Annexure six- table of definitions to date29

TABLE 11- PRELIMINARY TABLE OF DEFINITIONS

Item Definition Aerospace Entails all activities related to the design,

development, testing, evaluation, manufacturing, operating, maintenance, repair and overhaul of manned and unmanned air platforms (and their sub-systems) as well as the provision of related services (like training, logistical engineering, consulting) regardless of whether these are meant for defence or civil/commercial/non-defence utilization. Includes both controlled and uncontrolled items as the components of a galley are often similar for both defence and non-defence platforms and so would the ribs and spars. This expressly excludes what is generally defined as general aviation (i.e. activities that are exclusively set for use in passenger airlines like catering as well as private utilisation).

Defence Includes the land, air and sea capabilities as well as all other defence related activities like uniforms, body armour, etc as well as C4ISR, MRO, Training etc. Is applicable to all equipment that is specifically designed for and used in the defence applications regardless of alternative classification of such equipment and the control status of the equipment (NCACC/NPS/Explosives Act, etc.);

Dual Use Applicable to defence and non-defence settings

Maritime This entails all activities related to the design, development, testing, evaluation, manufacturing, operating, maintenance, repair and overhaul of manned and unmanned maritime/naval platforms (and their sub-systems) as well as the provision of related services (like training, logistical engineering consulting) regardless of whether these are

29 This may be added to /enlarged upon/ adapted during the course of the research


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Item Definition meant for defence or civil security purposes. This expressly excludes what is generally defined as boat building (i.e. yachts and sporting/personal leisure crafts).

Security All activities related to the design, development, testing, evaluation, manufacturing, operating, maintenance, repair and overhaul of (sub)systems (controlled and uncontrolled) that as well as the provision of related services (like training, logistical engineering, consulting) for utilization in what is broadly defined as security (safety applications as provided by the police services, civil/homeland security, border management activities and in some cases humanitarian work as well as peace keeping operations). This expressly excludes what is generally defined as private/commercial security or household and personal security.

Space The Space industry refers to “economic activities related to manufacturing components that go into Earth's orbit or beyond, delivering them to those regions, and related services”. The Space economy has been defined as "all public and private actors involved in developing and providing space-enabled products and services.”