Tag Archives: Modernization

The countertrade option

Something I put together for a thread on PinoyExchange


The AFP’s priority is to acquire whatever capabilities it can in the soonest possible time. Given a choice between using imported technology that is available now, or waiting for indigenous solutions to mature . . . naturally they will go with what is already available.

HOWEVER, purchasing items from foreign suppliers does not automatically mean that it is a disadvantage for local industry. The key mitigating factor is in the mode of payment. This is where COUNTERTRADE comes into play. With countertrade, vendors are paid in kind, not money. Government money is used to buy local products which are then used to pay the vendor.

The lead agency for countertrade transactions is the Philippine Investment & Trading Corp. (PITC). Based on PITC statistics, the AFP is the largest user of countertrade transactions. The following modernization items were paid for using countertrade:

-> SIAI-Marchetti S211 trainer jets (Italy): 40% of the amount was paid for with the following items: Crude Coconut Oil, Garments/Fabric, various Copra products, various Porcelain, Black Tiger Prawns, Activated Coco Carbon, various Handicraft

-> Squad Automatic Weapons (Belgium): 85% of the acquisition was paid for with semi-processed rubber

-> Harris communication equipment (USA): 100% paid for with semi-processed rubber products, dessicated coconut, various handicraft

-> 105mm howizter upgrade (France): 100% paid for with copra products, desiccated Coconut, canned Tuna, assorted handicrafts

Countdown to July 31, 2012

Secretary of National Defense, Voltaire Gazmin, announced the following during the 65th Anniversary of the Philippine Air Force

I am happy to let you know that thru our Defense System of Management, the upgrade and modernization program for our armed forces is presently in full swing. This limited only by the maximum amount of financial resources that our government can afford to allocate.

Your defense department is now working speedily on the approval of the contracts for the 138 upgrade and modernization projects of our armed forces, to be implemented over the next five years.

The deadline that we have set for ourselves for the approval of all these contracts is on July 31, 2012.

This month promises to be a significant milestone in the AFP modernization program.

Developing an Underway Replenishment (UNREP) capability

The 15-year Philippine Navy development plan, published on several newspapers discussed on the Timawa.net forum here, is noteworthy in that it highlights the navy’s recognition of the need for an Underway Replenishment (UNREP) capability. The list included a requirement for “three Logistics Support/Replenishment Ship (LSS)”.

UNREP is a process by which ships take on food, fuel, and other stores, while they are at sea. This eliminates the need to return to port for re-supply thus allowing the vessels to stay on-station longer, and reducing the non-productive transit time to and from the desired area of operations. Given the relatively small size of the Philippine Fleet, this capability will allow the AFP to make the most of limited resources.

The following is a video of how the US Navy performs both UNREP and VERTREP (Vertical Replenishment involving helicopters).

Both the BRP Gregorio del Pilar, and the BRP Ramon A Alcaraz are UNREP capable. The photograph below clearly shows the UNREP receptacle on the former. Theoretically the PN’s lone Cyclone class ship, the BRP Mariano Alvarez (PS-38), should have a similar capability since its sisterships in the USN are replenished while underway. The capability is there, so all that is required for in-house capability will be the supply ships. Before these arrive, the PN could, presumably, incorporate UNREP training in its exercises with its allies.

This topic is also discussed on Timawa.net here.

Modernization: The funding is there

Philippine military-oriented social media groups, from Facebook to Timawa.net are buzzing with talk about raising funds to help the AFP Modernization program. The Department of National Defense is reportedly even investigating a suspected scam involving individuals who are supposedly raising funds for the acquisition of equipment from concerned, but naive, Filipino nationals. But the sad reality is . . . there is no need for such efforts.

Turn the clock back a decade ago, then funding concerns were legitimate. The 1997 financial crisis was followed by political uncertainty that led to the ouster of a President by a text- message-revolution. This was followed by sweeping reforms in government procurement that left the AFP dazed and confused . . . so much so that it didn’t buy anything till 2003. Almost a decade after the AFP Modernization Law went into effect.

Today, in the 2nd decade of the century, the funding uncertainty and procedural confusion are things of the past. A long line of DND personnel (both in the current administration AND before), in cooperation with other government agencies (e.g. GPPB, etc.) have cut swaths of clarity through the tangled web of red tape. There is now enough knowledge to allow the application of the nation’s treasury to the cause of national defense. Consider the following:

  • Procedural impediments to effiicient use of the AFPMTF have been addressed. Modernization funds leftover for the year, and funds derived from authorized income, can now be accessed  with less difficulty than in years past
  • Proper access to Petro-pesos, both present and future, have been worked out. Malampaya funding has already been leveraged to acquire one ship for the Philippine Navy, and more acquisitions are lined up
  • Challenges with the Government Procurement Reform Act of 2003 have been dealt with, particularly the cumbersome bidding process which often yield the cheapest equipment rather than the best
  • Procedures for Multi-Year Obligation Authority (MYOA) were finally worked in the closing months of the previous administration. Acquisitions are no longer limit to the Annual modernization budget. Funds can be sourced from several annual budgets
  • The DND is now in the process of professionalizing the procurement process with the creation of the Office of Defense Acquisition

EVERYTHING has been worked out . . .

. . . except for the political intestinal fortitude to stay the course. As a modernization-minded AFP officer once said “Mindsets are the hardest things to modernize”.

BRP Ramon Alcaraz: The next WHEC

Interaksyon, the news portal of TV5, reports that when the USCGC Dallas will be turned over to the Philippine Navy, it will be renamed the BRP Ramon Alcaraz. The following is an excerpt of the relevant article.

Philippines’ second warship to be named Ramon Alcaraz, World War II hero

06-May-12, 1:54 PM | Chichi Conde, InterAksyon.co

CORREGIDOR — President Benigno Aquino III said the country’s second warship will be named after World War II hero Commodore Ramon Alcaraz.

During the 70th commemoration of the Fall of Corregidor on Sunday, Aquino said the best tribute that the country can offer to fallen heroes like Alcaraz is to build a nation capable of protecting itself.

The second Hamilton-class Cutter from the United States Coast Guard is scheduled to arrive in the country within the month.

Alcaraz, during World War II, commanded one of the country’s three motor torpedo boats, known as Q-boats.

His Q-112 took down three of the nine Japanese “Zero” fighters before he was captured.

In captivity, Alcaraz headed the prisoner of war camp in Malolos to take care of his fellow POWs.

< Edited >

The following is an excerpt of President Aquino’s speech, where he announced the name of the incoming WHEC:


< Edited >

As I was reviewing the names of our naval heroes, looking for a proper name for our second Hamilton Class Cutter, I read of a man named Ramon Alcaraz, who was commanding one of our three motor torpedo boats, known as Q-boats. Q-112 Abra, manned by Alcaraz and his crew, took down three of the nine Japanese “Zero” fighters attacking his boat, before being captured. In captivity, Alcaraz became head of the Prisoner of War camp in Malolos, making sure that his fellow POWs were kept hopeful and alive.

Commodore Alcaraz was only one among many skilled men in uniform who have served our country. Many continue to follow in his footsteps; and we are determined to reward their patriotism with equal dedication. For certain, many more Commodore Alcarazes will rise from the ranks of our military. We consider it our duty to ensure that their strength of spirit will be matched by boats, by weapons, and by sufficient training. This is the truest tribute we can offer to those who have laid down their lives: a nation capable of protecting itself; a nation that can say no sacrifice will be wasted.

< Edited >

See the following Timawa.net thread for a discussion about the passing of Admiral Alcaraz: Commanding Officer of Q-112 Abra passes on

Details about the Mosquito Fleet Q-boats can be found on the following Timawa.net discussion: Q-boat reference materials project

Update: CUP Phase 2 projects

The Philippine Star published the following figures and delivery dates for the indicated CUP Phase 2 projects. An older PIA article, however, stated that the total number of rocket launchers was “335”

Project Quantity Value Expected delivery date
Multi-purpose rocket launcher 335 P37,440,000.00 October 2012
81mm mortar with ammunition 100 units w/ 2,000 rounds P190,320,000.00 August 2012
Multi-Purpose Assault Craft (MPAC) Lot 2 3 P268,990,000.00 November 2012

Shipspotting: USCGC Dallas (WHEC-716)

Coast Guard Island’s proximity to a public marina made shipspotting efforts for the USCGC Hamilton relatively easy. Unless the transfer of the USCGC Dallas takes place at the same venue, observation of the transfer at WHEC-176’s current home port will present challenges for PN modernization watchers.

Based on the following references, WHEC-716 is based at the Charleston Marine Support Facility.


CHARLESTON, S.C. — Pier Papa at the Coast Guard Vessel Support Facility Charleston with Coast Guard Cutters Dallas, Gallatin, and Oak, and NOAA ships Ron Brown and Nancy Foster


The Charleston Marine Support Facility is located on the former Charleston Naval Base and is located with the USCG Naval Engineering Support Unit Charleston, in Charleston, South Carolina. The facility is the home port of the NOAA Ships Ronald H. Brown and Nancy Foster.

The Charleston Marine Facility consists of an 800 square ft. warehouse, a 650 ft. Pier and associated parking. The former naval facilities are of good quality and room exists for an increased NOAA presence in Charleston. The Charleston Marine Support Facility is managed by the Marine Operations Center – Atlantic.

The Charleston Marine Support Facility address is:

Charleston Marine Support Facility
1050 Register Street
Charleston, SC 29405-2421

There is no way to know if the ship below is either the USCGC Dallas or the USCGC Gallatin, which are both stationed in South Carolina. However the Google Earth images below, dated 1989, at least identify the anchorage described above.


JSOTF-P construction project in Camp Basilio Navarro, Zamboanga

FedBizOpps.com, US government equivalent to PhilGEPS, published a bid invitation to repave a road within Camp General Basilio Navarro in Zamboanga City, headquarters of Naval Forces Western Mindanao (NAVFORWEM). The Joint Special Operations Task Force (JSOTF) – Philippines is facilitating the project. Details are available at the following link.

Excerpts from the invitation

Repave Naval Station Road – Zamboanga City – Camp Navarro, Philippines

The contractor will provide all plant, labor, and materials required to repave the Naval Station Road at Zamboanga City – Camp Navarro, Philippines, in accordance with . . . Statement of Work.


The estimated magnitude of this project is between $25,000.00 and $100,000.00.


This is a construction project which will be performed in the Republic of the Philippines, Camp Navarro – Zamboanga City. The purpose of this project is to demolish, excavate and dispose of the existing asphalt and concrete road, which covers an area of approximately 1,900 square meters, in accordance with local laws and ordinances. The contractor is then required apply sub-base material and compaction to 95% maximum density; and, install a 150 mm thick reinforced concrete cover, with a rough broom finish. The successfull offeror will be required to provide appropriate warning signs and flagmen throughout the construction process. The request for quotation will be issued 2 January 2012; and, quotations must be submitted no later than 10 January 2012 at 4:30 PM Philippine Standard Time (PST). Pre-proposal site visit is tentatively scheduled 7 January 2012 at 2:00 PM PST. Contact the Contracting Officer at jsotfp.cco@gmail.com to RSVP for the Pre-proposal site visit. Prospective offerors will be required to submit concept drawings and plans with their quotations. The magnitude of this project, in accordance with FAR 36.204, is between $25,000 and $100,000. Performance is outside of the United States and its outlying territories; therefore, the award is unrestricted. There is no charge for the solicitation documents; contact the Contracting Officer (jsotfp.cco@gmail.com) for copies of the plans for inspection without charge.


Proposal Submission:

1) Submit your proposals NO LATER THAN 10 January 2012, 4:30 pm, Philippine Standard Time.

2) All quotations delivered in response to this solicitation shall reflect the following information on the address label:

a. Solicitation Number W91NF9-12-Q-C0001

b. The legend, “To be delivered unopened to the Contracting Officer”, and

3) Submit your proposal to the following address:

MSgt Michael A. Holder
JSOTF-P/J4 – Contracting
Camp Navarro – Zamboanga City, Philippines
Email address: Michael.holder@jsotfp.socpac.socom.mil