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É D I T I O N D ’ A A D 2 0 2 4 D E D EF EN S EH ER E

One of SANDF’s significant challenges is
the decline of its air force and navy due
Sub-Saharan Afr ca: reg onal defence to funding constraints. A large portion
spend ng as % of GDP (average) of the air force’s fighter jets, including
the Gripen C/Ds, have been grounded
due to a lack of maintenance. Similar-
2.0 ly, the navy’s frigates and submarines
require costly mid-life upgrades. For in-
stance, between 2023 and 2026, South
1.48 1.46
1.5 1.37 1.34 1.40 1.37 Africa allocated ZAR1.42 billion for up-
grades to its naval fleet, including the
Heroine-class submarines and Valour-
% of GDP 1.0
class frigates.

Defense Budget and Economic Condi-
tions
0.5 South Africa’s defense budget in re-
cent years has been severely impacted
by the country’s economic situation.
0.0 In 2023, the defense budget stood at
2018 2019 2020 2021 2022 2023 ZAR52.5 billion (USD2.86 billion), a de-
cline from ZAR52.3 billion in 2022. This
Note: GDP data from IMF World Econom c Outlook, October 2023. Analys s excludes Dj bout , budgetary contraction, in real terms,
Equator al Gu nea, Er trea, Seychelles, Somal a, Sudan illustrates the pressure the SANDF faces
in modernizing its forces. For context,
South Africa’s gross domestic product
(GDP) was valued at ZAR6.99 trillion (USD381 billion) in 2023, reflecting minimal growth compared to previous years.

Defense Industry: Denel and ARMSCOR
South Africa’s defense industry remains the most developed in the region, although it has struggled with financial and
management issues in recent years. Denel, the state-owned defense company, is a key player but has been in a precar-
ious financial position. As of 2022, Denel received a ZAR3.4 billion bailout under the Special Appropriation Act to im-
plement a turnaround plan, which included a 33% reduction in its workforce. However, the company reported a profit
of ZAR390 million in 2023, signaling a recovery phase. Despite this, Denel faces challenges in retaining skilled workers,
which is crucial for maintaining its competitive edge.

ARMSCOR, South Africa’s defense procurement agency, has also faced challenges. A 2023 parliamentary review re-
vealed that 32 of ARMSCOR’s 71 ongoing projects were rated as either ‘dissatisfied’ or ‘unsatisfactory.’ Among the
underperforming projects was “Project Hoefyster,” aimed at acquiring Badger infantry fighting vehicles. This project,
delayed by more than a decade due to Denel’s financial troubles, highlights the broader issues within South Africa’s
defense sector.
25 20
USDbn (constant, 2015) 15 10 5 0 % growth year on year Reg onal defence spend ng
15
20

10
-5
0 5 -10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Southern Afr ca West Afr ca East Afr ca Central Afr ca Real growth
©IISS
Sub-Saharan Afr ca: total defence spend ng by sub-reg on, 2008–23