On the Record with
Sir Charles Masefield, BAE Systems

BAE Systems' Masefield Sees Revived Asia-Pacific Growth -- Singapore All-Important

Sir Charles Masefield says his company has renewed optimism about the future growth prospects of the Asia-Pacific markets. Against an anticipated background of little or no growth in Europe and the Middle East over the next decade, BAE Systems is looking to the United States and the Pacific region for expansion-particularly in the defense sector.

According to Sir Charles, "In the Asia-Pacific region GDP levels, excluding Japan, are climbing back strongly. During the years of the so-called 'Tiger Economies' if you looked at the underlying figures, there was a manifested GDP growth of 4% or 5%-higher in some cases. Some people claimed double-digit growth but a good average was 5% and most countries are back at that stage." Hand-in-hand with that growth, he explained, would come renewed concerns about defense, deterrence and peace stability.

In Europe, BAE Systems' strategy has been to maintain its presence through joint-ventures, while in the United States it has established a series of wholly-owned U.S.-based businesses. In the Asia-Pacific region, BAE Systems has a predominantly stand-alone presence, though it is also active in major joint-venture interests such as Eurofighter and MBDA Missile Systems. Sir Charles told Show News that BAE Systems intends to grow its market share, aiming predominantly at countries in which it has already had success.

"We have been strong in the past in Indonesia, Malaysia-with C3I, Hawks, frigates, radios and various other projects, and Brunei with three OPVs. Korea is an excellent market for us, where we have supplied Hawks, and the combat systems for the KDX1 and two destroyers. We have had smaller successes in Japan where the U.S. influence is much greater and so we will use our U.S. companies to expand there.

"Singapore has been important to us in years gone by," he continued. "They flew Hunters and Strikemasters, but they have been predominantly supported by the U.S. since then. It has been a missed opportunity for the UK, but I must confess that we haven't always had suitable programmes to offer. Now we are responding to the RSAF's latest RFI with the Eurofighter Typhoon. We are already working with Singapore Technologies on the F-16 upgrade program-a very attractive package of upgrade technologies that will be on offer all around the world. BAE Systems will collaborate with that worldwide marketing."

Discussing Singapore's Next Fighter Requirement RFI, Sir Charles noted, "We will offer both technology transfer and industrial co-operation at a range of different levels, depending on Singapore's final decision. Singapore always conducts very thorough evaluations, and the DSTA and RSAF recommendations will be based very largely around operational capability and value for money.

"In a lot of countries you then have to superimpose politics, but not in Singapore. They ask 'what is the project that best meets the requirement'? I don't believe that industrial participation will be a factor in the post RFI evaluation in 2002. Our aspiration is to get on the shortlist. We will offer a full suite of weapons, everything that is available to our European customers, but a 'single' choice is never enough. Anything that Singapore asks for we will provide a plan for integration. I certainly don't see one competitor being able to offer a capability that we can't."

By Robert Hewson