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South African company supports peacekeeping in Africa

June 6, 2009

Paramount Group supplies equipment and logistic support vital for ending conflicts in Africa.

One of the unexpected benefits of South Africa’s apartheid legacy was the development of a highly competent defence industry. This defence industry and its related capability is an extremely important asset to the African Continent, a continent that is currently undergoing extensive conflict resolution and peacekeeping activity. When the Paramount Group was established some fifteen years ago, one of its core focuses was to assist African Governments to modernise their peacekeeping capabilities. In many cases this proved to be extremely challenging as budget limitations have always prevented African Governments from establishing modern capability.

Paramount Group’s Executive Chairman, Ivor Ichikowitz says “Several African Governments have for many years contributed troops and resources to international peacekeeping operations. A country such as Ghana is acknowledged by the United Nations as being a provider of some of the finest peacekeepers in the world”.

“Paramount” he continued “has made it its mission to ensure that African Governments are not only providers of human resources, but are now able to hold their own with the best in the world in the provision of complete peacekeeping battalions into both the African Union, as well as the United Nations peacekeeping missions around the world”.

Ichikowitz maintains that not enough attention has been given by the international community to effectively resourcing African Governments in a peacekeeping and conflict resolution arena, and he said that it was for this reason that a home-grown African solution had to be created, which gave rise to the Paramount Group’s unique business approach.

“Our primary objective” says Ichikowitz “has been to ensure that African Governments are able to receive world class equipment in an affordable fashion. Finance continues to be the major stumbling block to peacekeeping efforts by African countries.” He adds “It is imperative that African Governments take responsibility for peacekeeping missions on the African continent and avoid relying on non-African intervention in continental issues. Governments committed to peacekeeping efforts need to send properly equipped troops into these missions, but often do not have the capital budget available to fulfil their mandates.”

It may surprise those who think of Africa as a permanent war zone to know that many countries have a defence force strongly focused on peacekeeping. Primary among these is Ghana, the first African state to join the United Nations (UN) peacekeeping initiatives, almost half a century ago. At the last count, there were nearly 3 500 trained Ghanaians serving in a dozen peacekeeping initiatives around the world, making Ghana the sixth largest contributor of uniformed personnel to UN peacekeeping missions. Former UN secretary-general Kofi Annan hails from Ghana and has lent his name to the Kofi Annan Training School for Peacekeepers. Ghana also operates a military hospital for the United Nations Operation in Cote d`Ivoire (UNOCI) in Bouake. Several countries with stabilised security situations have followed suit, providing assistance to the UN, the AU and other peacekeeping forces on the continent and beyond.

Former chief of UN peacekeeping operations, Jean-Marie Guéhenno, stated in his retirement speech in July this year that the unarmed observers originally fielded by the UN 60 years ago would have little or no impact on today’s global conflicts. “I, for one, am convinced that force does matter,” he said. “To be able to be respected is essential, especially in civil conflicts.”

In order to develop a culture of involvement in peacekeeping, African countries need equipment, which in many cases is beyond their financial limits. Even Ghana, whose economy is booming, is subject to economic constraints. There are many manufacturers of defence equipment, but they are not finance houses, simply factories. They will not deliver a product until it has been paid for. At the same time, traditional finance houses have never been eager to finance large-scale operations in Africa, which often leaves peacekeeping missions sadly under-equipped and in many cases ineffectual.

Since inception, the Paramount Group devoted its efforts to coming up with an internationally acceptable solution that bridges this financial gap. By creating the internal merchant banking capacity to raise and provide finance, they allow economically burdened countries to acquire the necessary equipment immediately and spread the burden of repayment over several budgetary cycles. Their innovative financing methods combine funds raised through international capital markets as well as their own resources, but given that it is this which differentiates Paramount from other suppliers of defence equipment, they’re not giving away trade secrets.

Ichikowitz, who has been assisting African governments with this dilemma for over 15 years, says, “It might take years to build this budget. Many of these countries are trying to rehabilitate their economies with IMF and other assistance, and cannot immediately divert funds that may be required to purchase peacekeeping and defence equipment. In many cases there may be a limit imposed on how much of their GDP may be spent on defence. But if you can only buy so much per year, by the time the full system has been supplied, the first parts are already obsolete. Say you need 20 vehicles to embark on a peacekeeping mission, by the time you have assembled an efficient fleet it will be too late.”

Paramount’s tried and tested internal merchant banking facility enables it to provide clients with complete operating system of equipment immediately and be able to spread the financial burden over several budget years.

Packages are tailored to each client’s unique needs and terms may range from three to more than 15 years. Finance solutions are always structured according to a strong code of compliance with international norms and regulations.

Paramount’s role does not end with the supply of, say, a fleet of armoured vehicles, followed by the collection of payments. A key component of the package is logistical support in the form of training, maintenance and spare parts.

“We are very focused on maintaining long term relationships with our many customers,” says Ivor Ichikowitz. “We place a great deal of emphasis on training and long term technical support in order to ensure that the systems we supply achieve their operational life expectancy. Transfer of know-how and technology is an important facet of our service. We train technical personnel to utilize and maintain equipment. In every country which we have supplied, we continue to be involved in keeping vehicles operational in ongoing peacekeeping missions.”

Paramount has supplied equipment solutions into several African countries, all of which are in active use in peacekeeping efforts. The company continues to support clients all over Africa to keep operating efficiently in multiple mission areas. Their systems have proved to be first-rate and reliable and many customers have been sole sourcing much of their capital equipment from Paramount over many years for this very reason.

On a technical and financial basis, they have proved more than able to support countries that want to acquire equipment, training and acceptable financing.

“Our job,” says Paramount CEO John Craig, “is to enable people to go and do the job they need to do immediately, with the right equipment they need, when they need it.” Ichikowitz maintains that the entire Paramount team is passionate about Africa and each and every member of the team’s primary mission is to ensure that every project it undertakes contributes to the peace and stability of the continent and in so doing making sure that a firm foundation is laid for the growth, development and prosperity of the continent.