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France’s Naval Group Guarantees Support for Littoral Combat Ship (LCS) Project

KUALA LUMPUR: France’s Naval Group has given its assurance to support the government’s efforts in resuming the Littoral Combat Ship (LCS) project.

“The company also agreed to resume talks with Boustead Naval Shipyard Sdn Bhd (BNSSB) on the price,” the Defence Ministry said in a statement yesterday.

The ministry added that the naval group also expressed its commitment to ensuring that the LCS project will be completed within the time frame set by the government.

This comes after recent talks between a Malaysian delegation and Gael Diaz De Tuesta, the head of the International Directorate of the Directorate General of Armaments (DGA), the French Defence Ministry, and the Naval Group.

“The Malaysian delegation consisted of Defence Ministry secretary-general Datuk Seri Muez Abd Aziz, deputy Navy chief Admiral Datuk Abdul Rahman Ayob, and Armed Forces Fund Board (LTAT) chief executive Datuk Nazim Rahman, and several others.

“The meeting was conducted during a working visit to Euronaval in France,” the ministry said.

It added that the latest development is positive for the LCS project and will ensure the project resumes smoothly.

Earlier this month, Defence Minister Datuk Seri Hishammuddin Hussein said the mobilisation phase for the LCS project was running smoothly.

He said this phase, slated for June to December, involved efforts by the government, especially his ministry, the Royal Malaysian Navy, LTAT and BNSSB.

A number of matters were concluded in the first three months of the phase, he added.

“On the commercial side, two things are ongoing. BNSSB has concluded talks with 145 local vendors and 42 overseas original equipment manufacturers (OEMs). The local vendors and OEMs have pledged their support for BNSSB to resume this project.

“Efforts to end the involvement of middlemen, Contraves Advanced Devices (CAD) and Contraves Electrodynamics Sdn Bhd (CED), are currently being pursued.

“It will enable BNSSB to negotiate with OEMs and vendors directly. This can reduce the cost of ship equipment,” he said.

On Aug 4, the Parliament’s Public Accounts Committee (PAC) revealed that some RM1.4bil in government allocations for the LCS project had been used for other purposes, including cost overruns.

The two-year probe by PAC also revealed that the RM9bil project was done through direct negotiations with BNSSB, and was inked in 2014.

On Aug 17, former Navy chief Tan Sri Ahmad Ramli Mohd Nor, the former managing director of BNSSB, was charged with three counts of criminal breach of trust involving RM21.08mil over the project.

Two reports were subsequently declassified, including the one by the governance, procurement, and finance investigation committee, which said the cost of completing the six LCS might balloon to RM11.145bil.

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