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US Normalizes Defense Trade Relations with South Africa - 2004-07-21

The U.S. ambassador to South Africa has announced the normalization of defense relations between the two countries after a long legal dispute. South Africa's largest arms manufacturers may now freely trade with the United States for the first time since 1991.

It started with sanctions busting. The United Nations placed an international arms ban on apartheid South Africa and three South African defense firms were indicted in a U.S. court for trying to get around it. Those companies, two of them state-owned, were then barred from trading with the United States.

The case was settled in 1996 and the ban was suspended in 1998. But commercial transactions still had to be individually approved under a special program designed to evaluate the companies' compliance with U.S. laws.

U.S. ambassador to South Africa Cameron Hume says the case casts a dark shadow over defense trade relations between the two countries. Thirteen years later, the legal wrangling is over.

Billy Nel is a spokesman for one of the companies, the state-owned Armaments Corporation of South Africa, known as ARMSCOR. He welcomed the normalization of defense trading between the two countries.

"Defense as such is a very sensitive issue and one has to be very transparent and accountable in all your actions," he explained. "Obviously we have been trying to meet all requirements of the compliance program. And this will enable us to aggressively pursue potential markets in the states and obviously for American companies to do likewise in South Africa."

A statement from the South African deputy minister of foreign affairs welcomed the announcement and encouraged the South African defense industry to use this occasion to actively pursue business opportunities in the United States.

Although in dollar terms the defense sector is not considered one of South Africa's major industries, it is an influential part of the South African economy, partly because the state owns several of the largest defense companies.

The agreement will allow U.S. firms to prepare for a major South African defense and aerospace industry expo taking place in September.