Adding New Meaning to Daylight Robbery

By Masterwordsmith

In February this year, Malaysians were aghast when Defence Minister Datuk Seri Dr Ahmad Zahid Hamidi announced that the government agreed to allocate RM6 billion to build six second-generation patrol vessels for the Royal Malaysian Navy. The rationale given for the expenditure was to “boost the economy while benefiting 632 vendor companies“. The Defence Minister clarified that they would ensure that “at least RM2bil of the allocation will benefit these vendor companies which are strategic partners of Boustead Naval Shipyard Sdn Bhd”.

Evidently, there is big $$$ in defense.

According to Wikipedia:

It is estimated that yearly, over 1.5 trillion dollars are spent on military expenditures worldwide (2.7% of World GDP). This represents a decline from 1990 when military expenditures made up 4% of world GDP. Part of this goes to the procurement of military hardware and services from the military industry.
The combined arms sales of the top 100 largest arms producing companies amounted to an estimated $315 billion in 2006. In 2004 over $30 billion were spent in the international arms trade (a figure that excludes domestic sales of arms).

Today, the Defense Security Cooperation Agency notified Congress today of a possible Foreign Military Sale to the Government of Malaysia for 20 AIM-9X-2 SIDEWINDER Block II All-Up-Round Missiles and associated equipment, parts, training and logistical support for an estimated cost of $52 million.

According to the press release issued by DSCA HERE (inaccessible in Malaysia but has been re-posted HERE), the Government of Malaysia has requested a possible sale of:

  • 20 AIM-9X-2 SIDEWINDER Block II All-Up-Round Missiles
  • 8 CATM-9X-2 Captive Air Training Missiles
  • 4 CATM-9X-2 Block II Missile Guidance Units
  • 2 AIM-9X-2 Block II Tactical Guidance Units
  • 2 Dummy Air Training Missiles
  • containers, missile support and test equipment, provisioning, spare and repair parts, 
  • personnel training and training equipment, publications and technical data, 
  • U.S. Government and contractor technical assistance and other related logistics support. 
  • The estimated cost is $52 million.

This proposed sale will contribute to the foreign policy and national security of the United States by helping to improve the security of a friendly country that has been, and continues to be, an important force for political stability and economic progress in East Asia.  CLICK HERE for more.

In mid-August this year, The Australian reported that AUSTAL has won a $330 million contract to produce eight new patrol boats for the Australian customs service. The total value of the project is $330 million, including a $280 million design and construction contract and an In-Service Support contract worth $50 million.

The contract is for the design, construction and through-life support of eight Cape Class patrol boats for the Australian Customs and Border Protection Service.

Comparatively, it appears that the Australians can build EIGHT NEW PATROL BOATS at AUS$330 million (RM1.016 billion) @ 127 million per boat while in Malaysia, six new patrol boats cost us SIX BILLION RINGGIT at RM1 BILLION per boat. Even if the patrol boats from both countries are different in technology or design, surely the difference cannot be that glaring?