"Damen's Presence in the Latin American and Caribbean
Market" - Part 1
W. Alejandro Sanchez
Center for International Maritime Security (CIMSEC)
July 18, 2015
Though shipbuilding is a competitive global industry, one
company has become a major provider to the naval forces (coast guards included)
of various Latin America and Caribbean states: Damen Shipyards Group. Damen is
now a household name among Latin American and Caribbean navies as it provides
multi-purpose vessels, patrol boats and speed boats. These sales have enhanced
the capabilities of Damen’s clients as they face transnational threats.
While the defense budgets of Latin American and Caribbean
states cannot be compared to those of the usual suspects (i.e. the U.S., Russia
or China), a significant number of weapon deals have occurred in recent years
between the Dutch-based company and these two regions.
Damen’s sale of technologically advanced vessels is a
positive development for the region for a variety of reasons. Most notably,
since Latin America and the Caribbean are enjoying a marked lack of inter-state
conflict (the last war between two
regional states was in 1995), the region’s security forces are now focused
largely on transnational crimes, particularly drug trafficking. Thus, it
appears that Damen’s clientele will continue to grow for the immediate future
as the company is looked upon as a reliable supplier of vessels necessary to
combat criminal activities that occur at sea, particularly in the Greater
Caribbean region.
In order to discuss Damen’s effect on the shipbuilding
industry and naval defense sector in Latin America and the Caribbean, a brief
enumeration of confirmed deals and equipment delivery is necessary. This will
also give us a clearer view of Damen’s clients.
The Caribbean
Damen has a number of clients in the Caribbean whose naval
forces are more akin to coast guards rather than traditional navies. One good
example is the Bahamas, which formalized a deal with Damen in 2014 for a
variety of vessels, including four Stan Patrol 4207, four SPa 3007, and one roll-off
ship Stand Lander 5612. The shipbuilding portion of this multi-faceted contract
is valued at around $149 million.
The company has already delivered the four 4207 patrol
boats. Moreover, this past January the Damen Gorinchen shipyard in the
Netherlands received the hull for the Stan Patrol 3007. It is important for the
3007 to become operational soon as this vessel is urgently needed by Nassau to
combat narcotics trafficking, a further example of how Damen technology is
being utilized for positive security initiatives.
Another one of Damen’s clients in the Caribbean is Trinidad
& Tobago. This past May, the government in Port-of-Spain ordered 12 new
vessels for its coast guard, including four type Stan Patrol 5009, two Fast
Crew Supply 5009 and six Interceptor speedboats. The deal is worth $189 million
USD. In early June, the “TTS Point Lisas” (GC 23), one of the FCS ships, was
delivered to the Caribbean government.
Latin America
When it comes to the mainland, several Latin American states
are turning to Damen for naval equipment. For example, the Colombian Navy
purchased one of Damen’s Swath-type vessels, which was constructed in
Singapore. Additionally, in 2014,
Ecuador signed a deal with Damen to obtain two Stan Patrol 5009 for the
country’s coast guard. The vessels are being constructed in Ecuador by the
country’s shipyard, Astilleros Navales Ecuatorianos, under the oversight of
Damen technicians. Additionally, Damen obtained a contract in early 2014 to
construct a fourth Stan Patrol 2606 (the country already operates three), which will also be built in Ecuador.
Additionally, Mexico and Venezuela have purchased various
types of Damen’s vessels. Just this past January, the Mexican Navy received the
Coast Guard vessel Tenochtitlan-class “ARM Mitla” (PC-334), which was
constructed as a joint project between the shipyards of the Secretaria de
Marina (the Mexican Navy) in Tamaulipas and Damen. The “Mitla” is based on the
Stan Patrol 4207 model. This is the second of two vessels that Mexico and Damen
are building together following a 2014 agreement. The other vessel is a supply
variant of the Fast Crew Supplier 5009. Like the “Mitla,” it is also being
constructed in Mexico’s Sonora state. These developments suggest that Damen has
become an integral part of the country’s naval shipbuilding. Apart from the
aforementioned vessels, SEMAR and Damen jointly constructed three other patrol
vessels based on the 5009 model.
As for Venezuela, Caracas has ordered a number of new
vessels for its Navy including a 2014 deal for 18 type Interceptor 1102
speedboats. The speedboats are being constructed in Cuba under the
Havana-Caracas cooperation agreement. The first of these vessels arrived this
past May and is currently undergoing testing. In addition, Damen has also
constructed four support vessels for the South American nation based on the
Stan Lander 5612 model. On February 2014, a new contract was signed for an
additional eight vessels, a deal worth around $132 million USD. Finally,
Venezuela’s military complex (UCOCAR) in Puerto Cabello is building five patrol
boats based on the Stan Patrol 2606 model. The country’s navy already has one
operational vessel based on that model, the “Pagalo” (PG-51).
Cuba’s Shipyards
It is important to note that Damen has a construction
facility, Damex Shipbuilding & Engineering, in Cuba. The facilities, which
were established in 1995, are located in the bay of Santiago de Cuba. Damen’s
website explains that “the yard is equipped with one slipway provided with
transverse parking facilities for new buildings and repairs and a lateral
slipway for new buildings of up to 100 metres.” As previously noted, the
shipyards have constructed vessels for Venezuela.
It is important to stress that not all Damen deals have been
scandal-free. This is best exemplified by a 2013 contract via which the
government of Honduras purchased six Interceptor speedboats and two Stan Patrol
4207. The contract deal was reportedly worth almost $62 million. However in
late 2013, the Honduran judiciary investigated it due to various
irregularities, specifically the accusation that the vessels were
overpriced – according to the Honduran
newspaper La Prensa,the vessels were overpriced by some $29 million. The
newspaper argued that the Honduran Secretariats of Defense and Finance created
a paper company called “Servicios Maritimos S.A.,” which was utilized by
Florentius Antonious Florentius Kluck, a
Dutch citizen and honorary consul, as the intermediary for the sale.
In spite of these accusations, the deal ultimately went
through, and the Honduran Navy has begun to receive the vessels. This is an
important deal for Honduras since drug traffickers utilize the country’s coast
for transporting illegal narcotics, and thus it is especially necessary for
small Central American country to have vessels that can locate and seize the
infamous narco-speedboats. Nevertheless, the details of the deal themselves are
problematic, as the question its transparency and whether the Honduran
government could have obtained similar vessels at a cheaper price. Even more,
even though the Honduran judiciary never passed judgment on the deal, scandals like the Honduran affair throw
into question whether other contracts gained by Damen were due to shadowy
middle men and nefarious deals.
