Indonesian military expects Sukhoi jets to arrive for its anniversary after inking the deal

A Sukhoi Su-35 Flanker fighter-bomber in flight. (Shutterstock)
Updated 16 February 2018
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Indonesian military expects Sukhoi jets to arrive for its anniversary after inking the deal

JAKARTA: The Indonesian military is expected to welcome two Sukhoi Su-35 "Flanker-E" to its combat aircraft fleet in October, after signing a contract to buy the fighter jets from Russia.

A spokesman for the Defense Ministry, Brig. Gen. Totok Sugiharto confirmed to Arab News that the contract for 11 multirole combat aircrafts was signed in Jakarta on Feb. 14.

Rear Adm. Agus Setiadji, head of defense facilities agency at the ministry, signed on behalf of the Indonesian government with a representative from Russia’s state-owned defense product broker, Rosoboronexport.

The first two fighter jets are expected to arrive in early October, said Totok, in time to take part in the TNI parade to celebrate armed forces day on Oct. 5. TNI is the Indonesian acronym for the Indonesian Armed Forces.

“The Sukhoi jets would replace the existing F5-E Tiger jet fighters fleet,” he added.

The contract, worth $1.140 billion, was finalized following negotiations that started in 2017. It includes the signing of a bilateral deal in Moscow in August to barter coffee, tea, palm oil, cacao, spices and the commodities’ derivatives, processed fish and textiles as well as Indonesia’s defense products with the Sukhoi fleet. Indonesian state trading company PT Perusahaan Perdagangan Indonesia and Russian state conglomerate Rostec will be the agencies implementing the barter trade.

The part-barter deal will allow Indonesia to pay 50 percent of the Sukhoi jet fighter contract by exporting its commodities valued at $570 million, Trade Minister Enggartiasto Lukita said in August at a joint press conference with Defense Minister Ryamizard Ryacudu.

“With this barter deal, Indonesia can export more commodities that we have exported before, as well as the ones that we didn’t get to export previously,” Enggartiasto said.

Under Indonesia’s defense industry law, the procurement contract for defense equipment from foreign producer is subject to at least 35 percent offset requirements. Russia has said that it will provide 35 percent offset from the contract value by providing a training for maintenance and repair of the Sukhoi fleet.

In October, then-military chief Gen. Gatot Nurmantyo said in accordance to request from the air force, that the Sukhoi jets will be equipped with air-to-air missile, air-to-ground missile, bombs, ground support equipment, simulator, spare parts and spare engines.

The Indonesian Air Force already has a full squadron of Sukhoi Su-27 SKM and Su-30 Mk2 jets.

Since the administration of President Susilo Bambang Yudhoyono, who is President Joko Widodo’s predecessor, Indonesia has been significantly increasing its defense budget to modernize its aging Armed Forces fleet and equipment and rejuvenate its defense industry.

Its spending on military equipment aims to meet the minimum essential force target by 2024 or the bare minimum of primary defense equipment to safeguard the country’s vast archipelago.


UK firms step up preparations for a ‘no-deal’ Brexit as PM Theresa May meets with EU leaders

Updated 21 March 2019
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UK firms step up preparations for a ‘no-deal’ Brexit as PM Theresa May meets with EU leaders

  • May is meeting EU leaders in Brussels on Thursday in attempt to get support for Brexit delay
  • The Bank of England warned in November that the British economy could shrink by a massive 8 percent

LONDON: UK companies have ratcheted up their preparations for a disorderly “no-deal” Brexit as best they can over the past couple of months, the Bank of England said on Thursday.
With the prospect of a chaotic Brexit potentially eight days away, a survey by the central bank’s agents showed that around 80 percent of companies “judged themselves ready” for such a scenario, in which the country crashes out of the European Union with no deal and no transition to new trading arrangements with the bloc. That’s up from around 50 percent in an equivalent survey in January.
For decades, trading with the rest of the EU has been seamless. A disorderly Brexit could see the return of tariffs and other restrictions on trade with the EU, Britain’s main export destination.
To prepare, some firms have moved jobs and operations to the EU to continue to benefit from its seamless trade. Many have had to learn how to file customs declarations and adjust labels on goods. Exporters of animals are learning about health checks they will need to comply with.
According to the bank’s survey, however, many of those companies preparing for a “no-deal” Brexit said “there were limits to the degree of readiness that was feasible in the face of the range of possible outcomes in that scenario.”
There’s only so much companies can do, for example, to prepare for new tariffs and exchange rate movements.

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Britain appears headed for a “no-deal” Brexit on March 29 if Prime Minister Theresa May fails to win parliamentary support for her withdrawal agreement with the EU.
She is meeting EU leaders in Brussels on Thursday in an attempt to get support for a delay to the country’s departure date to June 30. EU leaders have said a short extension would have to be conditional on her Brexit plan getting parliamentary backing and have indicated they would only be willing to back a delay to May 22, the day before elections to the European Parliament. After two heavy rejections in parliament, there are doubts as to whether she will be able to get parliamentary approval. What would happen next is uncertain.
European leaders, including those from France and Luxembourg, have said any extension will be granted dependent on May's deal passing a third parliamentary vote.
The Bank of England warned in November that the British economy could shrink by a massive 8 percent within months, though Governor Mark Carney has indicated the recession will be less savage, partly because of heightened preparedness.
According to the minutes of the latest meeting of the bank’s nine-member Monetary Policy Committee, at which the main interest rate was kept at 0.75 percent, rate-setters warned “Brexit uncertainties would continue to affect economic activity looking ahead, most notably business investment.”
Brexit uncertainty has dogged the British economy for nearly three years. In 2018, the economy grew by 1.4 percent, its lowest rate since 2012, even during what was then a global upswing. Business investment was down 3.7 percent in the fourth quarter from the year before.
“Business investment had now fallen in each of the past four quarters as uncertainties relating to Brexit had intensified,” the rate-setters said.
The survey showed uncertainty was likely to remain for months, even years, as Britain works out its long-term relationship with the EU. It said around 60 percent of UK firms in February said Brexit was one of their top three uncertainties, compared with 40 percent just after the June 2016 Brexit referendum.
Around 40 percent of firms expect the uncertainty to be resolved only by the end of 2019 and 20 percent anticipate it persisting into 2021 or beyond.