Economy & Trade, Headlines, Latin America & the Caribbean

PERU: Questions About Big Ticket Military Purchases

Ángel Páez

LIMA, Apr 27 2010 (IPS) - The indefinite postponement of the purchase of five Chinese tanks and a failed test of Israeli missiles have called into question the transparency and effectiveness of major military purchases in Peru.

To the surprise of the public in Peru, during a military parade on Dec. 8, a state holiday, the army displayed five Chinese MBT-2000 tanks. On that occasion, Defence Minister Rafael Rey announced that Peru had chosen the tanks to replace Soviet-made T-55 tanks from the 1960s.

Although the army actually preferred Russian T-72 tanks, in the end it opted for the Chinese model for economic and political reasons, it was reported.

Peruvian President Alan García signed the agreement with China’s leader Hu Jintao on Nov. 13, 2009 during the last Asia-Pacific Economic Cooperation (APEC) forum in Singapore.

The following month, the five tanks were delivered to Lima.

But when the agreement was made public, the Ukrainian state enterprise for foreign trade and investment, PROMOBORONEXPORT, which had unsuccessfully tried to sell Peru the T-84 Oplot tank, informed the Peruvian army that China was not authorised to reexport to a third country the MBT-2000 engine and transmission, which were made in Ukraine.

The defence minister asked the Ukrainian government to clarify the situation. But while still waiting for the response, he unexpectedly announced on Apr. 6 that the plans to purchase the MBT-2000 tanks had been indefinitely put on hold.

The argument he offered was that the government had decided it was better to invest in Mi-17 transport helicopters, because aircraft were urgently needed for the counterinsurgency fight against remnants of the Sendero Luminoso (Shining Path) guerrillas in the Apurimac and Ene river valleys, known as the VRAE region, and for use in rescue and relief efforts during natural disasters.

But another factor was the failure to clarify the problem raised by the Ukraine.

“China offered us a tank with cutting-edge technology, with the systems required by the army,” Rey told IPS. “It’s a vehicle that is perfect for our geographic conditions. Moreover, we got a discount from the original price,” he said, pointing out that China’s state conglomerate and defence giant NORINCO reduced the price per tank from 5.8 to 4.7 million dollars.

“However, it’s also true that the Ukrainian government has not yet clarified whether or not it has given China permission to reexport the Ukrainian components in the tank,” the official added.

“Our priority is focused on improving air transport,” he said. “We have very few helicopters – a crime in a country with a territory as vast and difficult as ours. Helicopters are better to buy than tanks.”

Retired general Roberto Chiabra, who served as defence minister under President Alejandro Toledo (2001-2006), believes there was “improvisation” in the case of the Chinese tanks.

“I don’t understand why the Chinese tanks were paraded in an official, public ceremony if the purchase had not taken place and the necessary technical evaluations were far from being completed,” he told IPS.

“Nor do I understand why the purchase was announced if it was not sure that Ukraine would not throw a spanner in the works of the operation, because of the engine and transmission business,” said Chiabra, who is also a former army chief.

“It’s important to remember that five months before the purchase was announced, a team of army specialists reported that the Chinese tank was lacking several components to meet our technical requirements,” he said.

Minister Rey insisted, nonetheless, that “the tanks are the best, but for now we’re not going to buy them.”

Misguided missiles

Meanwhile, on Apr. 16 the army tested one of the 288 Israeli-made Spike anti-tank guided missiles purchased in 2009 for 55.8 million dollars.

Right before the eyes of Rey, army commander Otto Guibovich, three members of Congress and representatives of Rafael Advanced Defence Systems – the state-owned Israeli manufacturer of the missiles – the missile chosen for a night test went off course and crashed after just 100 metres – 3,900 metres short of the target.

Guibovich fired off a harshly worded letter to the company, expressing “surprise, disappointment and shock” over the failed test.

Retired army captain José Robles, an expert on military affairs in the non-governmental Legal Defence Institute, said Guibovich’s complaint should have been made before a single cent was paid to the Israeli army.

“The tests of the quality of the Spike missiles should have been done in the factory in the presence of Peruvian army officers and technical experts,” Robles commented to IPS.

“The missiles brought over were supposedly in perfect condition. That’s why a great deal of money was paid for them, because we’re talking about state-of-the-art technology,” he said.

According to Robles, the suspension of the purchase of the Chinese tanks in the midst of questions and doubts and the Spike missile incident are signs of a lack of transparency in the purchases.

“The acquisition of the tanks was announced, we’re told they’re the best on the market, they parade down our streets, and suddenly it’s announced that the purchase has been indefinitely postponed,” he said.

“And now a Spike anti-tank missile fails a test that should have been carried out in Israel to the satisfaction of the Peruvian military. I believe there is a combination of a lack of transparency and technical inefficiency,” he said.

The Spike missiles cost more than double the 288 Russian-made Kornet anti-tank missiles purchased for 23.7 million dollars.

And the Kornet missiles performed just fine in night-time and day-time tests, on Mar. 31.

“There should be closer monitoring of military purchases,” said Chiabra, because “Peruvians are expecting transparency, given the fact that we’re talking about major public expenses.”