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Assessing and promoting civil and minority rights in South Africa.

[Source: Business Day by Stephan Hofstatter.]

State-owned arms manufacturer Denel is reeling after a bad year in which weapons orders plummeted, half its board jumped ship and a disastrous and costly partnership with associates of the Gupta family came to an end.

Denel’s bungled partnership with Gupta-linked VR Laser Asia, which was cancelled on Friday, has cost it dearly by delaying its critically needed re-entry into the Asia Pacific market by more than a year.

Denel had identified concrete opportunities for selling artillery, armoured vehicles, missiles and drones to India worth R100bn after being blacklisted for a decade following a kickbacks scandal in 2005. But its partnership with the Guptas to drive SA’s re-entry into the lucrative market, through a shelf company in Hong Kong, put paid to these plans after the Treasury withheld approval for the establishment of the partnership, in which Denel would own 51%.

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South Africa at a Glance
58 780 000 (mid 2018 estimate)
4.5% y/y in June 2019 (CPI) & +5.8 y/y in June 2019 (PPI)
-3.2% q/q (1st quarter of 2019)
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