Offset Agreements Research Articles

Optimising Offset Defence Implementation as Fulfilment Efforts in Fighters Aircraft Materials and Technology

This research aims to investigate the implementation of defense offset as a strategy to address the gap in the supply of materials and technology for fighter aircraft among countries. In this context, the gap arises due to the complexity and high costs associated with fighter aircraft development. Many countries, particularly those with limited technological and manufacturing capabilities, face challenges in acquiring and developing advanced aircraft. This gap negatively impacts their defense capability enhancement efforts. Therefore, the concept of defense offset emerges as a potential solution. Defense offset is a strategy in which foreign aircraft manufacturers provide compensation in the form of technology transfer, investment in the local defense industry, or research and development collaboration to the purchasing country. Through steps such as identifying material and technological needs, planning clear offset agreements, transferring relevant technology, developing the local industry, supplying materials, research and development collaboration, as well as monitoring and evaluation, the implementation of defense offset can be optimized. This research employs a qualitative method with a descriptive approach, involving a literature study to gain in-depth information about defense offset implementation and its impact on the material and technology gap in fighter aircraft. The results include the identification of factors influencing the success of defense offset implementation, political, economic, and strategic implications, as well as the benefits obtained by purchasing countries. In conclusion, through the optimization of defense offset, purchasing countries can reduce the gap in materials and technology for fighter aircraft, enhance domestic defense industry, and strengthen national defense capabilities. With the right strategy, defense offset can be an effective tool in addressing the gap in fighter aircraft material and technology, thereby fortifying national defense.

The Polish Air Force in transition: lessons from the F-16 programme

ABSTRACT The purpose of this article is to analyse the process of equipping the Polish Air Force with the F-16 aircraft. The Polish F-16 programme serves as an essential source of knowledge for avoiding errors that may occur when introducing new weapon systems in Poland, or other post-communist countries that are still reliant on Soviet-designed military technologies. Due to various external and internal factors, not all elements of the F-16 programme are suitable for replication in the acquisition of new weapon systems; however, some solutions have been applied in Poland’s F-35 and WISŁA air defence programmes. The authors examined selected aspects of the F-16 programme, including its historical background, legal and organisational framework, personnel training, infrastructure, logistics, and the economic implications of the offset agreement.

Brazilian Air Force acquisition policies: observing absorptive capacity and contingent factors in aeronautical beneficiary companies

AbstractThe offset agreement (OA) of the Brazilian Air Force (FAB) is a demand-side policy aiming to improve innovative capacities. However, it may be constrained by companies’ absorptive capacities, relationship features, and sectoral specificities. This study examines these issues in a small but representative sample of domestic beneficiary firms from the FAB’s OA. The model in the study by Zahra and George, along with contingent factors such as power relationship and social integration mechanisms, inspired the design of the research tools. The results point to similar and high firms’ absorptive capacities, regardless of the origins of capital. However, results show distinct benefit perceptions given by contingent factors, companies’ strategies, and sectoral specificities, which may denote distinct possibilities on cumulativeness and appropriability from technology transfer. We expect that these findings may improve the planning, monitoring, evaluation, and adjustments of this demand-side policy, attracting attention to new studies on the theme.

МИНИМИЗАЦИЯ РИСКОВ ОФСЕТНОГО ИНВЕСТИРОВАНИЯ

This article reveals the features of the offset transaction as a promising investment mechanism for the development of industrial production in Russia. A comparative description of the offset contract with widely used special investment contracts, agreements on the protection and promotion of investments, concession agreements, agreements on public-private/municipal-private partnership, life cycle contracts is considered. During the analysis of the offset contract model, the main four stages of procurement were identified: procurement planning; determining the supplier conclusion of the contract; performance of the contract. The risks of offsetting organizations during the offset transaction structuring, as well as the risks of inaccuracy and incompleteness of information about the project are described. Measures have been proposed to minimize risks when drawing up and fulfilling an offset agreement.

Concurrent 11. Presentation for: INPEX-led Ichthys Joint Venture – proudly partnering with Indigenous Groups in the Northern Territory

Presented on Wednesday 18 May: Session 11 The INPEX-led Ichthys Joint Venture has established strong partnerships with the Northern Territory Government (NTG), cultural organisations and Traditional Owner groups in the Northern Territory to deliver social and environmental offset programs. The key governance model for delivery of the offset programs is the Ichthys Project Voluntary Offset Agreement (IPVOA), which commits $91 M AUD over a 40-year period through a suite of offset programs. This paper focuses on the journey to partner with the NTG-run Aboriginal Ranger Grants Program (ARGP). Through the IPVOA, INPEX and its Ichthys Joint Venture participants will contribute $24 M AUD over 22 years, to the ARGP, for Aboriginal Ranger programs addressing specific species and their associated habitat throughout the Top End. This is the first time where industry has contributed to the ARGP to deliver positive outcomes in the NT. This has been achieved by fostering collaborative, engaging and trustworthy relationships with the Commonwealth and NT governments; engaging with the Aboriginal Land Management Advisory Group; and meeting with Aboriginal Ranger groups. The key has been finding a common ground between the perspectives and the priorities of all stakeholders for how best to deliver conservation management on country in the NT. This common ground is likely to evolve over the next 22 years as the INPEX-led Ichthys Joint Venture and NTG deliver environmental outcomes, promote a connection to country and empower Aboriginal Ranger groups to better manage their country for future generations. To access the presentation click the link on the right. To read the full paper click here

INPEX-led Ichthys Joint Venture – proudly partnering with Indigenous Groups in the Northern Territory

The INPEX-led Ichthys Joint Venture has established strong partnerships with the Northern Territory Government (NTG), cultural organisations and Traditional Owner groups in the Northern Territory to deliver social and environmental offset programs. The key governance model for delivery of the offset programs is the Ichthys Project Voluntary Offset Agreement (IPVOA), which commits $91 M AUD over a 40-year period through a suite of offset programs. This paper focuses on the journey to partner with the NTG-run Aboriginal Ranger Grants Program (ARGP). Through the IPVOA, INPEX and its Ichthys Joint Venture participants will contribute $24 M AUD over 22 years, to the ARGP, for Aboriginal Ranger programs addressing specific species and their associated habitat throughout the Top End. This is the first time where industry has contributed to the ARGP to deliver positive outcomes in the NT. This has been achieved by fostering collaborative, engaging and trustworthy relationships with the Commonwealth and NT governments; engaging with the Aboriginal Land Management Advisory Group; and meeting with Aboriginal Ranger groups. The key has been finding a common ground between the perspectives and the priorities of all stakeholders for how best to deliver conservation management on country in the NT. This common ground is likely to evolve over the next 22 years as the INPEX-led Ichthys Joint Venture and NTG deliver environmental outcomes, promote a connection to country and empower Aboriginal Ranger groups to better manage their country for future generations.

Ensuring that offsets and other internationally transferred mitigation outcomes contribute effectively to limiting global warming

Ensuring the environmental integrity of internationally transferred mitigation outcomes, whether through offset arrangements, a market mechanism or non-market approaches, is a priority for the implementation of Article 6 of the Paris Agreement. Any conventional transferred mitigation outcome, such as an offset agreement, that involves exchanging greenhouse gases with different lifetimes can increase global warming on some timescales. We show that a simple ‘do no harm’ principle regarding the choice of metrics to use in such transactions can be used to guard against this, noting that it may also be applicable in other contexts such as voluntary and compliance carbon markets. We also show that both approximate and exact ‘warming equivalent’ exchanges are possible, but present challenges of implementation in any conventional market. Warming-equivalent emissions may, however, be useful in formulating warming budgets in a two-basket approach to mitigation and in reporting contributions to warming in the context of the global stocktake.

ATTRACTION OF INVESTMENTS USING THE OFFSET AGREEMENT

The article is devoted to an offset agreement (a state agreement which is providing for counter-investment obligations of a supplier-investor to create or modernize and (or) develop production of goods in the territory of a subject of the Russian Federation to provide the state needs of a subject of the Russian Federation). In addition to the legal regulation of offset agreements, their subject composition is also determined, and the features of their conclusion are highlighted. The study analyzed all 4 offset contracts currently signed in Moscow and the Moscow region. According to the author, the offset agreement is an investment agreement, and the interaction of the subject of the Russian Federation and the supplier-investor in the implementation of the offset agreement can be qualified as a public-private partnership that is beneficial to both the state and business: the benefits that are received by the subject of the Russian Federation and the supplier-investor are given. As an improvement of the legal regulation of offset agreements, the author suggests providing for the possibility of concluding them at the federal level, as well as differentiating the minimum investment volume depending on the level of socio-economic development of the subject of the Russian Federation. The conclusion is made that public-private partnership, carried out in the analyzed form of agreement, is a promising mechanism for attracting investment in the constituent entities of the Russian Federation.

CONTRATOS EM OFFSET: CONTRATOS INTERNACIONAIS E OS ENTRAVES DA LEGISLAÇÃO BRASILEIRA NO PROCESSO LICITATÓRIO

The theme of this article is: Offset contracts: international contracts and the obstacles of Brazilian legislation in the bidding process. The following problem was investigated: Does the Brazilian State have an agenda to mitigate contractual barriers between the international actors involved in the Offset agreements? The following hypothesis was considered: Is there specific legislation designed to accompany the compensation clauses throughout the Offset project? The general objective is: To identify the historical background of the international legislative evolution up to the present. The specific objectives are: To enter the historical points of creation; how it was adapted to the national territory. This work is important for an operator of the Law, for society and science as a whole, because the lack of specific legislation designed to accompany the compensation clauses throughout the Offset project makes the international legislative equalization go beyond the policy budgetary authority conferred on the State. This is a qualitative theoretical research lasting five months. As a result of the research conducted, it is concluded that the Offset is an instrument of political and strategic influence that should not be contained in the military area, the Offset can assist technological and industrial progress as a whole, in the case of the dynamics of each contractual agreement. International practice, it is impracticable to develop a suitable legislative context for the reception of a rigid execution linked to the Offset agreement.

Development of a mathematical model of conflict between the parties in the implementation of the offset transaction

The object of research of this work is the conflict of interests of the parties in the implementation of offset agreements. One of the most problematic places when implementing offset agreements is that a wide variety of sudden events, force majeure circumstances, etc. can take place – phenomena that can’t be described in detail and predicted with acceptable accuracy in full. In addition, the offset contract is a conflict of interest between the seller and the buyer. During the study, the methods of the humanitarian and natural-scientific approach are used, thanks to which the conflict was given a new interpretation. It is considered as a way of interaction of complex systems. It is shown that the conflict is not a synonym for confrontation, but a way to overcome contradictions and limitations, a way of interaction of complex systems is an inevitable, normal phenomenon. Of course, conflict involves struggle, but, above all, conflict involves interaction. It is shown that the conflict can’t be considered as an optimization task, since with equal resources of the parties, the conflict will be terminated due to the complete depletion of both sides, and with unequal resources, the defeat of the weaker side with a probability of one. Also, the conflict can’t be resolved within the framework of the theory of adaptation. A brief comparative analysis of the possibilities of using varieties of Markov processes and the degree of their adequacy to the real processes of supporting offset transactions at different stages is carried out. A mathematical model of the conflict between the parties is proposed. In the model, the process of conflict development is a branched semi-Markov process, the transitional and final probabilities of which depend on the ratio of resources of the parties. In addition, the conflict represents a sequence of concerted actions of the parties and, in fact, is a controllable quasiperiodic process with elements of stochasticity. The resulting winnings of the parties to the conflict are investigated with varieties of their cooperation and rivalry. The proposed model can be used to model the processes of development and implementation of offset programs and the wins of the parties.

Success and failures of the Gripen offsets in the Visegrad Group countries

ABSTRACTThe Soviet-led Council for Mutual Economic Assistance member, Central European countries found themselves in a difficult political and economic situation after the collapse of the Soviet Union. Three post-Eastern Bloc countries formed the Visegrad Group to strengthen their ties to the West, but the need for foreign investment, job creation and technology transfer was urgent.This is when military modernisation also came into the picture and the counter-trade—as known as offset—as a tool to help these economies. A trade practice which was meant to energise these economies via defence acquisitions linked economic programmes.Two Visegrad Group member countries, Hungary and the Czech Republic decided to sign offset agreement with the defence firm SAAB to license Gripen fighter aircrafts. This study intends to analyse if these deals were able to help governments to reach their objectives or the two countries were unable to take advantage of the offset programmes.

Researcher attitudes to offset agreements for OA publishing

Watch the VIDEO.The Swedish government has expressed an intention to move towards open access (OA) to publications based on publicly funded research in Sweden. As part of fulfilling this intention, the Bibsam Consortium, working on behalf of a number of Swedish universities, government agencies, and research institutes, has started to include OA in their negotiations with publishers. One consequence is that Bibsam has followed other international actors and entered into a number of offset agreements. The first of these agreements was Springer Compact, which runs from July 2016 to December 2018. The implementation and consequences of this agreement are being investigated at the request of Bibsam, and this presentation builds on findings from this investigation.Offset agreements are presented as one possible road ahead, a temporary one, in the transition towards OA to scholarly publications. A number of factors, including costs and the speed of flipping hybrid journals to full OA, will determine the success of such agreements. The attitudes of the researchers – the authors of the publications – are also key in determining the outcome. This presentation reports on findings from a questionnaire submitted by 375 first authors of articles covered by the Swedish Springer Compact agreement. It will present the authors’ attitudes to OA, to the Springer Compact agreement, and to future similar agreements.The study shows that only about one quarter of respondents knew about the agreement before submitting their work. A majority would not have paid article processing charges (APC) for their article had APCs not been covered by the agreement. Many are generally positive to OA publishing, however. When asked what they think about agreements such as Springer Compact, three quarters wrote in free-text answers that it is “good”, “very good” or “excellent”. Respondents express both appreciation of the easy process and a relief over not having to find funding for OA.Some respondents were more tentative, saying that they appreciate OA, but that their opinion about the agreement depends on the cost. Non-profit solutions to academic publishing or alternative methods to achieving OA were also mentioned as desirable. A small number of respondents would prefer the traditional subscription model. Yet, the vast majority of respondents say they would like to see similar agreements with other publishers.The answers to the questionnaire show that these researchers are very positive to having their work published OA if it is not associated with costs, limitations, or other hassles for the researcher. That is, if publishing remains no more problematic than in the subscription system, researchers see many benefits with OA. However, there is a minority which expresses ideological hesitation. From this, universities and funders can learn the value of facilitating OA publishing for the individual researcher, but also that many researchers will expect agreements to be economically feasible and that there is a potential to engaging researchers even more in the discussion of future solutions.

OFFSET AS AN ECONOMIC OPERATION AND A TRADE PRACTICE

Offset agreements are widespread in sales of defense products. There is a steady tendency to increase their share as a percentage of world trade. Developed countries with well-established Defence Technological and Industrial Bases, use offset transactions to target activities to business organizations and countries with emerging economies use offset to gain military and commercial benefits. The following paper examines the offset as an economic operation which represents a wide range of industrial and trade practices .

OFFSET AS AN ECONOMIC OPERATION AND A TRADE PRACTICE

Offset agreements are widespread in sales of defense products. There is a steady tendency to increase their share as a percentage of world trade. Developed countries with well-established Defence Technological and Industrial Bases, use offset transactions to target activities to business organizations and countries with emerging economies use offset to gain military and commercial benefits. The following paper examines the offset as an economic operation which represents a wide range of industrial and trade practices.

The Offset as a Specific Sort of Economic Activity

Offset agreements are widespread in sales of defense products. There is a steady tendency to increase their share as a percentage of world trade. Developed countries with wellestablished Defence Technological and Industrial Bases, use offset transactions to target activities to business organizations and countries with emerging economies use offset to gain military and commercial benefits. The following report examines the offset as an economic operation which represents a wide range of industrial and trade practices.

(The Role of Offset Agreements when Obtaining New Technologies)

Bulgarian Abstract: В настоящият доклад се разглежда възможността за изпълнение на програми за компенсиране в България, подробно са разгледани приоритетните продуктови области, съгласно Стратегията за развитие на българската отбранителна и технологична индустриална база. Разработен е обширен анализ и подробно сравнение на действителната технология и нейните приложения. English Abstract: The following report examines the possibility of implementing programs for offset in Bulgaria, detailed are the priority product areas, according to the Strategy for Development of Bulgarian defense and technological industrial base. An extensive analysis and detailed comparison is made on the actual technology and its applications.

Incentive Mechanisms in Industrial Development: An Evaluation through Defense and Aviation Industry of Ankara

There is an ongoing debate about the dynamics of technological catch-up of domestic firms in an increasingly globalized and uncertain world economy. Incentive mechanisms are one of the routes of these debates. Incentives which are related to the overall market conditions and the structure of competition, as well as government policies guide the allocation of resources and the effort to develop new knowledge. Governments often play an important role as providers of the information and technology sources, establishing or supporting science parks, clusters, coordinating the relationship between industry and university/research institutions, directing financial support to innovative enterprises, promoting exports etc. This paper explores the extent of incentive and support mechanisms which shape government policies and firm strategies in terms of industrial development through the case of defense and aviation industry in Ankara which has a leading role in the development of the sector.The defense and aviation industry is a special sector among others in many respects. The firms in the sector invest heavily in R&D and innovation. The industry is heavily regulated and protected, and public instruments such as R&D procurement and offset agreements are commonly used to support national interests and domestic firms. Through the last 20 years, Turkish defense and aviation industry has determined its direction as meeting its requirements more domestically, having an international regional market and begin to take its place in the global competition. Incentive and support mechanisms are important to ensure the development and sustainability of this uptrend and performance in the following phase. In this respect, this study will examine the related incentive mechanisms by various institutions and the exploitation level of firms. The relation between the incentive exploitation level of the firms and the firm characteristics such as, firm size, age, quality of the labor, innovative capacity and the firm performance such as increase in turnover, exports etc. through firm surveys conducted with defense and aviation companies in Ankara will be evaluated.

Capable Companies or Changing Markets? Explaining the Export Performance of Firms in the Defence Industry

The paper presents an analysis of the factors explaining the export performance of firms in the defence sector. We focus on the case of Norway, and make use of two complementary methodologies: the first is based on econometric firm-level data analysis for the whole population of defence companies, and the second is based on qualitative case study research on the three most important defence export products (weapon stations, ammunition and electronics). Our empirical results highlight the importance of four major success factors for exporting firms: (1) the participation in offset agreements; (2) the ability to focus on their set of core competencies; (3) their R&D activities and interactions with the public S&T system; and (4) demand opportunities and, relatedly, user-producer interactions.

O modelo de integração de sistemas da indústria aeronáutica: fatores motivadores

A ampliação das alianças estratégicas na indústria aeronáutica mostra uma clara opção dos fabricantes de avião por um modelo de integração de sistemas em que eles concentram o seu foco em atividades relacionadas às suas competências essenciais. Apesar da importância desta indústria e embora os principais fabricantes de avião do mundo estejam adotando este modelo, a literatura sobre este tema ainda é escassa e, mesmo a existente, encontra-se muito fragmentada. Este trabalho, qualitativo e de cunho teórico-conceitual, aproveita a literatura disponível e observa a movimentação dos principais fabricantes de avião do mundo para identificar e compreender os fatores que os têm motivado a adotar este modelo. Os seguintes fatores foram identificados: o interesse em tecnologias e empresas especializadas, os acordos de offset e as grandes barreiras e riscos existentes na indústria aeronáutica. Como decorrência do modelo de integração de sistemas, a indústria aeronáutica sofre atualmente uma agressiva desintegração vertical.

The Limits on the Security for an Obligation Functionality Through the Types of Offset Agreement

The Limits on the Security for an Obligation Functionality Through the Types of Offset Agreement