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DefMin Les on Army equipping programs: Major investments of over 1bn euro in next 10 - 15 years

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Minister of National Defence Gabriel Les told AGERPRES in an interview that military hardware supplies for the Romanian Army's major equipping projects are "almost impossible" in 2017, underscoring that he intends to sign this year all the relevant contracts.

The DefMin also says that major multiannual equipping programs are being envisaged with a considerable chunk thereof expected to exceed one billion euro in the next 10 — 15 years.

Les also spoke about the corvette and 8x8 armored vehicles procurement programs, the plans of the Ministry of National Defence (MApN) to buy a new squadron of F-16 Fighting Falcons, but also about the Law of the volunteer reservist and the Army's need for human resources.

The Minister says that the first foreign troops of the NATO multinational brigade based in Romania will arrive in April, and that the final operational capacity will be attained in fall next year.

AGERPRES: At the MApN stocktaking meeting you said that Romania is prepared to cope with the regional security challenges. We see however that the procurement program has just a slothful advance, not to say that it that it's treading water. How is Romania prepared to face these challenges?

Gabriel Les: These equipping programs, what the 2026 Romanian Army equipping program approved under CSAT decisions provides for, are future procurements. At the presentation of the MApN stocktaking report we also proceeded to a self-assessment of the structure — what we currently have, without referring to the existing capabilities and our capacities of response to operational requirements, those from our NATO partners included. These procurement programs imply very large investments, most of them are major multiannual programs, a good chunk of them will most likely exceed one billion euro over the next 10 — 15 years, but things don't advance at the speed we'd like them to. These procurement programs (...) we've been preparing for so long have reached various stages of let's say, maturity, preparation, when they are ripe for the launch of the bidding process designed specifically to meet the Army's operational requirements and of course, to seamlessly adjust (...) to the governing program, which means integrating an as high as possible percentage in the national defence industry. (...) 
When we discuss the national defence industry I am referring to all companies, be they state-run or national companies that existed before 1990 and which had military hardware and technology production capacities, and also everything that means new operators, new companies — private ones included, or those that could come create jobs, production lines for various production processes.

AGERPRES: The political and technocratic sphere share this view that the procurement must seamlessly adjust to the national defence industry. Corvettes are the most frequently mentioned in this period. As far as I know, but maybe I am wrong, the Damen shipyard in Galati is the only facility capable to produce such technology-laden craft. If the owner of the Galati-based shipyard is not in your views, than who is?

Gabriel Les: This is a little broader subject. It's been extensively circulated in the media lately and I want to act transparently during my term at the helm of this ministry. Our intention is to be sufficiently transparent and explain very well what we do with these 2 pct [of GDP], because this is a lot of money. This political commitment of Romania's is also a commitment to our NATO allies. We repeal this government decision because of the shortcomings arising from the absence of Parliament endorsement for all procurement of over 100 million [euro]. The legislation is very clear: previous to initiating the proceedings one must first get Parliament endorsement through the joint committees on defence, public order and national security. To have Parliament's endorsement for everything that exceeds 100 million euro. This means that you commit to a multi-annual financing, to multi-annual contracts. It's logical to seek this endorsement and not to release the government decision before this Parliament endorsement is in place.

I'd like to say this very clearly: this equipping program is a priority for the Romanian Army, it remains a necessity, the operational requirements exist even now. This is a very important program at this moment. Just a brief parenthesis — we are trying to develop in a balanced manner all force categories in the Romanian Army. We cannot buy just for the Air Force, or for the Land Force alone. (...) We will soon start the procedure under observance of all the legal provisions in force. This does not mean that we stop now. The operational requirements of the force category do not change, and we will carry on. (...) In my capacity as Minister of National Defence I ponder on whether to use the existing financing to fill a gap that exists at the moment, because the Defence Ministry has been underfinanced for long, and this is also the reason for the current situation of the industry. On the other hand, I want to integrate as much as possible of this amount in the industry. It's logical, and at political level we must assume this. It would make no sense to take all this money and buy foreign products and integrate none of it in Romania. (...) Our intention is not to choose a shipyard or to come up with a suggestion like "build at this or that facility." Any global operator, preferably NATO and EU, can come to (...) forge associations with companies in Romania, to integrate on the product we need in a Romania-based shipyard.

The shipyard you mentioned (...) currently has a product they build and get certification for. It is a certified product they also supply elsewhere. From this point of view, they do have an edge. But our criteria are very simple: to meet the operational requirements and as much as possible of the amount we are about to spend for the procurement be spent in Romania. Of course, we also have what comes from offset compensation. Offset operations should bring Romania top benefits.

AGERPRES: Do you take into account purchasing this product directly from abroad? Is there this possibility?

Gabriel Les: No. Our intention and wish for any product is to integrate it, even if in the beginning there will perhaps be very low levels of integration in the national industry, because not all the industry is prepared to take over what we have. (...) From our perspective, the MApN's, we have presented an extremely transparent situation in respect to our necessary endowment for the next 10 years. I have come particularly before the economic operators of Romania, and not only. (...) The ones which will have the capacity to refurbish, to recapitalize, to make some investments that could offer this product will have a leverage in our acquisition process. I don't want to currently think about acquisitions on this level, that won't be integrated in our industry in a certain percentage, because, certainly, we cannot discuss of a 100 percent integration. Unfortunately this is the globalization nowadays.

AGERPRES: You spoke about very low levels of integration. This could mean a minor subassembly therefore I don't see the relevance of integrating it in our defence industry.

Gabriel Les: I will give you an example: it's possible not to be able very quickly to offer, for instance, a F-16 aircraft to the Romanian Army and integrate it here in production. If we were to establish maintenance centers, a technological transfer that would mean maintenance centers for their operationalization, for their operation, which is very important because the costs of operating this aircraft would decrease very much. We cannot talk about certain products that currently on a worldwide level are on a certain technological level which we need, because we have to respond to certain operational requirements and put at our allies' and NATO's disposal certain capacities. (...) This year is a year we need to win from this point of view.

AGERPRES: In respect to the corvettes, have you received signals from any foreign company that might be interested in investing in Romania and manufacture them here?

Gabriel Les: This kind of signals exist, I couldn't tell you anything concrete, but there are this kind of signals. It will be up to them if they can build these corvettes on a dockyard in Romania.

AGERPRES: Over the last days a piece of information surfaced according to which Romania is to purchase approximately 270 APCs (armoured personnel carrier — e.n.) produced in partnership with German company Rheinmetall. Can you give us more information?

Gabriel Les: It would have been very good to be so, but it's not. Information appeared, I don't know where from. Our intention to purchase these 8x8 APCs is very clear since last year. The number is higher than what you have said, namely 276 (...). There are at least 3 producers in the European Union that meet the operational requirements of the Land Forces, but again, our intention is to integrate something in our national industry, even though, if one is to talk about, for instance, the energy aggregate, the gearbox, about (...) what drive line means—, there are only a couple of worldwide producers. But the integration of this product is necessary to be made in respect to matters of national security, and supply security. The Economy Ministry has in plan the manufacture of these 8x8 APCs. Such contract was signed last year, if I'm not mistaken, (...) between Moreni and this company Rheinmetall. For us is very important to see an approved product, that will meet the requirements, and we have it as an acquisition plan.

AGERPRES: At the end of this year, what will Romania have, physically speaking, beyond those F-16 aircraft that are to arrive?

Gabriel Les: Another three aircraft. That chapter has come to an end with the 12 aircraft that were purchased for the Air Forces. If we talk about major endowment projects there are very little or none. Because everything that means technical production and military technology on this level — and then we are talking about corvettes, 8x8 APCs, 4x4 armored and non-armored vehicles — all these have a production process of more than a year, it goes from three years up. In the corvettes' case four years. And so on. It's very possible that we won't have deliveries in respect to major projects this year. (...). It's almost impossible, but our intention is to sign all these contracts, so that starting two years form now to be able to take these products. Certainly, that doesn't mean that this year we won't purchase components, science, but on a lower level. We are talking about the infantry's combat machine, which entered upgrading, we are talking about the ammunition part, which is delivered much quicker, multi-purpose APCs, that started to be delivered last year. Deliveries will also happen this summer, we will continue to purchase trucks and a lot of other small acquisitions related to force categories. (...) The amounts are lower, we are not talking about such large programs.

AGERPRES: You recently stated that Romania intends to purchase another 20 F-16 aircraft from the US. Were there any discussions with the US partners? Were the aircraft identified? I know that it was a problem related to the fact that the aircraft in the formula that we wanted weren't found.

Gabriel Les: Starting last year we have sent letters regarding the intention to purchase a new F-16 aircraft squadron. Now, there is no point to talk about why the F-16 aircraft, because this decision was taken a long time ago, almost 7-8 years ago and it makes sense to chose the same solution. There are extremely good aircraft, which meet our operational requirements, NATO's necessary capabilities, they are inter-operable. These aircraft have a flight resource because they are revitalized — new engines, technique and technology included in the dashboard equipment. (...) We have this letter. Certainly, our intention was to purchase them from our NATO and EU partners. There were letters that were first sent to countries in the EU, if there is an excess, if such aircraft is for sale. We don't have a positive response so far. We don't have a positive response from the US, because they are brought from there, let's say we don't have a final response, but the purchase will be carried out. I can't tell you now if we will conclude the contract this year or the next one. (...) We will exhaust the flight resources for the MIG aircraft that we own and then those will have to be replaced with these new aircraft.

AGERPRES: I understand that currently we don't have a final response from the US? What about from our European partners?

Gabriel Les: Our European partners haven't given us a positive response until now, either. The majority of them, if I'm not mistaken, even all of those that had such machines and whom we have send such intention letters, responded they don't have them for sale.

AGERPRES: There are some officials of the Defence Ministry from whom I have heard that there might be a way to modernize some old aircraft, MIG-29 type. Can something like that be done?

Gabriel Les: I doubt that such solution could be one for the future. If I'm not mistaken, there is such equipment in the endowment, but nonfunctional, they are in preservation. We don't consider them for modernization. It would mean to have 12-15 aircraft of a certain type and 15 of another type. The maintenance expenses and the costs of making them operational, of using them would be extremely expensive, therefore we cannot take them into account for the moment. A decision in this regard will be taken within the ministry, this year.

AGERPRES: Are you optimistic that at the end of this year the allotment of the GDP — the 2 percent — will be entirely spent?

Gabriel Les: Of course I am optimistic, and this, by taking a look at the needs that currently exist in the National Defence Ministry. The NATO requirements, for instance, are for at least 20 percent of this amount to be spent for new equipment acquisitions. At the moment we have somewhere over 40 percent, not to say 45 percent, according to our calculations, possible contracts that we can sign this year, certainly, the completion of these contracts, their signing and probably the payment of some deposits, depending on the situation. But the products will start coming in two-three years, four years from now.

AGERPRES: Russia is strengthening the fleet at the Black Sea. How do you assess the security situation in the area and what does NATO do to stay in the game in this area?

Gabriel Les: Everyone knows this situation, the situation in our region, in the Alliance's south-eastern flank. There are two matters here: in the first place, I would like not to regard it as a weakness or poor situation for Romania, but on the contrary, a situation in which (...) Romania can be a stability pillar in this area and it can be a situation that could benefit us in establishing this heavyweight pillar both in the EU and in the relation with the NATO partners. As you know, in the Warsaw Summit, the Black Sea area was validated as a region of strategic interest. What is more interesting is that at our country's proposal there was defined the concept of adapted advanced allied presence, (...) and this major decision gained substance and was materialized during the two ministerial meetings that followed, so that in the most recent ministerial meeting we could discuss about a strengthened allied presence at the Black Sea on all three components, maritime, in the first place. We are strictly talking about the Black Sea, but also on the land area, we are talking about the multinational brigade and the air area, even if we are talking about those exercises we have at the moment, including support for the air police on behalf of the member states: UK, Canada, the United States, and other countries that signed up for these exercises.

AGERPRES: You have mentioned the multinational rotational brigade. When will it become operational, what countries participate in it, with what technique?

Gabriel Les: We are talking about approximately 13 allies who, so far, have announced their intention — others are even present — to affiliate forces or troops, officers, support, some even financial support to the land component of the advanced presence. (...) The multinational brigade will reach its initial operational capacity on Romania's territory this year, in April 2017, and we hope to complete the final operational capacity at the end of 2018, somewhere in October-November. There are 13 allies (...) who are present. The exercises this year are multiple, on all three components, air, maritime and land.

AGERPRES: Which interval will the rotation be done?

Gabriel Les: Yes, it is a matter that I wish to specify very clearly. We are not talking about a permanent presence here. The rotation will be done depending on the calendar and exercises. I couldn't tell you right now about each presence.

AGERPRES: Does the rotation also entail the technical part?

Gabriel Les: Certainly.

AGERPRES: The law of the reservist has come into force in the year beginning. I have seen you have uploaded on the website the implementation norms as well. Why was this law necessary, what do you hope it changes upon its coming into force?

Gabriel Les: This law of the volunteer reservist entails attracting the persons with proper military experience, (...) as well as the people who don't have a certain type of military background, but are willing to give it a try. I believe that it can be a solution to improve the staff we'll attract to Romania's Army. At the moment, we have funds for approximately 2,800 — 2,900 such positions.

AGERPRES: Is there a problem with human resources in the Army?

Gabriel Les: Here it is a matter that has been perpetuating for several years because of the lack of funds for the Army, but also since the conscription was eliminated, the Army has witnessed a staff exodus. I couldn't tell you right now that it is necessarily a special problem, although last year there were very many officers who retired or went into reserve. (...) I believe with the statute of the volunteer reservist we'll manage to draw youths — some have a little bit of training, others want to see if they are fit for this — (...) to the military career. Of course, here we also have prepared certain financial resources, including for the payment of these reservists during training, but we also have prepared modifications to the laws that concern the career guide, so that anyone in this system can make a self-evaluation in terms of what the future in such a career looks like.

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