DSA 2022: Benefits of Malaysian offset programme remain unclear
The AV4 Lipanbara for the Malaysian Army was procured from Chaiseri in Thailand. (Gordon Arthur)
Malaysia runs a defence offset programme, but there are weaknesses in the way it is being monitored and evaluated.
The Malaysian Auditor General’s report released on 22 March stated that the MoD’s Industrial Collaboration Programme (ICP) has benefited recipients. Nevertheless, the report concluded that the MoD has not comprehensively evaluated the ICP’s results and its long-term effects.
The MoD’s management of its ICP in the 2018-20 timeframe was one matter covered in the Auditor General’s report.
The ICP comprises offset obligations for all MoD procurements, services and work contracts. These are implemented on contracts worth RM50 million ($11.9 million) or more for foreign companies and RM100 million and above for local companies.
A total of RM31.278 billion of ICP
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