Is it so wrong to build the new frigates at LSE

In the month of July last year, the Malaysian Government announced that they were negotiating with BAE to build two additional Lekiu class frigates in upgraded version optimised as Air Defence ships to be called Batch 2. The Defence Minister announced that one of the conditions negotiated was for these ships to be built at Labuan Shipyard Engineering (LSE) to provide employment opportunities for the are and also to develop shipbuilding skills of the nation. Even before the announcement has died down, many critics voiced out their opinions that the Kedah class building debacle will be repeated, that is the program will be in fits and starts especially since the Batch 1 program itself was delayed in their delivery for several years. This forced the Minister to issue a statement that (sic) " Malaysia will learn from the previous experience in implementing the construction project of the two new frigates" a week after the announcement.

Nonetheless the critical voices continued, especially when it was announced that BAE has signed an MOU with the company Realmild, owner of LSE for the project. They said that this is another political project headed for trouble as they claim that Realmild is a subsidiary of the politically linked Media Prima entertainment local giant and has no shipbuilding experience. Hello everybody, do you know that Media Prima's management board has been successful in turning around a company that was at land's end due to the economic crisis and has now become a corporate giant again. And this was a management group that had no media industry experience in the beginning but with striving efforts they did it. That's just it, in business you need able management, not expertise in a particular industry as such expertise can be learned and LSE foremostly needs turning around and thus I am confident that this project will work out.

Some also says that the nation cannot afford to have two naval shipbuilders but do they understand that we actually do not have any naval shipbuilding specialist. Boustead Naval Shipyard also builds civilian vessels to ensure good revenue as no one can survive by just depending on MAF purchases only. Anyway, with two dockyards that can support naval shipbuilding at both ends of of maritime nations divided by the South China Sea, it would certainly help the RMN to obtain support services for the vessels but this fact is also disputed. But can anybody deny the fact that both our premier front-line vessels has been dry docked at the same time?

The best thing, there are also accusations that this project was not properly planned and done hastily. They cannot accept the fact that the project has been well planned by all parties to ensure it is sustainable and viable. One thing I really like is that part of the conditions in the LOI awarded are that BAE must establish sufficient facilities and ensure transfer of technology is carried out BEFORE the purchase agreement is concluded. This is different than before where TOT is usually an afterthought or even neglected that many such manufacturing programs faces problems as the seller may stop the transfer of capabilities, especially if there are delays in payments. In other words, this is not business as usual, because if the conditions in the LOI is not followed including preparing sufficient facilities for local construction, the sale itself will not be pursued. This is why I believe the project will go well. Don't tell me that Datuk Shahrir will keep quiet if there are any hanky-panky in such a high profile project.