The UAE’s state-owned investment firm Tawazun Holding said on Thursday it will develop, manufacture and integrate guided systems for conventional air munitions in a joint venture with Denel, South Africa’s biggest maker of defence equipment.
Analysts are seeing the move as a latest push to diversify its economy away from oil.
The UAE’s Air Force will be the first customer of Tawazun Dynamics, whose facility will be set up in an industrial park on the outskirts of Abu Dhabi. Tawazun will own 51% of the project with Denel owning the remainder. No financial details of the weapons project were given but the announcement said that details of the specific product systems will be announced at the start of 2013.
The project is part of Abu Dhabi’s efforts to boost the non-oil economy to 56% of GDP by 2020 and 64% in 2030, from 41% in 2005-07. UAE has invested billions of dollars in aerospace, tourism, infrastructure and real estate.
“The creation of Tawazun Dynamics marks the next chapter of Tawazun’s continued focus on the development and diversification of the UAE’s industrial base,” Tawazun Holding chief executive Saif Mohamed al Hajeri said.
Tawazun Holding, set up in 2007, signed a joint venture agreement with Algeria in July to produce up to 200 armoured vehicles annually starting late 2014.