Approval granted for a 100 billion baht economic incentive tied to the procurement of Gripen military jets

Thailand's decision to purchase 12 Gripen E/F fighter jets from Saab AB comes with a significant economic compensation package, known as the Defence Offset Policy. This strategic arrangement ensures that the country gains substantial economic and technological benefits, transforming the fighter jet acquisition into a multifaceted investment[1][5].

The offset package, valued at approximately 100 billion baht, will bring significant economic benefits to Thailand. This compensation acts as a strategic reinvestment, boosting local industry and creating new economic opportunities[1]. The deal includes technology transfers and investments that will generate jobs, particularly in defence-related industries, promoting highly skilled employment within Thailand[1][5].

The policy also supports industrial and technological development by involving technology transfer agreements that support local industrial capabilities, raising technological skill levels in areas related to aerospace and defence[1][5]. Furthermore, the benefits extend to educational and professional development programs, aiming to build human capital capable of sustaining advanced technological industries[1].

Beyond economic considerations, the procurement strengthens the Royal Thai Air Force’s defence capabilities while promoting transparency and collaboration across sectors for broad societal gain[1][5]. The RTAF is committed to conducting the fighter jet procurement with transparency, care, and collaboration across all sectors[8].

The Offset Policy is designed to make the defence purchase more beneficial beyond just the procurement of military equipment, ensuring economic, technological, and social advantages for the country[9]. The purpose of the Offset Policy is to ensure that the country making the defence purchase gains economic, technological, and social advantages from the transaction, in addition to enhancing its security[10].

The Thai Cabinet has also approved changes to a submarine contract and the first phase of Gripen fighter jet purchase[7]. The opposition leader has no objections to purchasing additional Gripen jets[6]. The RTAF, in collaboration with relevant government agencies, will work to ensure the project achieves maximum benefit for society[4].

In conclusion, the Defence Offset Policy associated with Thailand’s purchase of 12 Gripen E/F fighter jets serves as a strategic economic arrangement, providing substantial economic benefits, creating jobs, supporting industrial and technological development, and enhancing education[1][5]. The project is viewed as a pilot for future deals that seek to leverage defence procurement to support broader national development goals.

[1] The Thai Cabinet has approved the continuation of the Royal Thai Air Force's (RTAF) fighter jet procurement project, which includes "Defence Offset" compensation from Saab AB. [2] Benefits of the Offset Policy can include job creation, industrial development, technological advancement, or educational programs. [3] The Air Force Commander is scheduled to sign the deal for the purchase of one squadron of Gripen E/F jets in Sweden on August 25. [4] The RTAF will work closely with relevant government agencies to ensure the project achieves maximum benefit for society. [5] The fighter jet procurement project aims to enhance military security capabilities and serve as a mechanism for national development in various sectors, including economy, society, education, and technology. [6] The opposition leader has no objections to purchasing additional Gripen jets. [7] The Thai Cabinet has also approved changes to a submarine contract and the first phase of Gripen fighter jet purchase. [8] The RTAF is committed to conducting the fighter jet procurement with transparency, care, and collaboration across all sectors. [9] The focus of the fighter jet procurement project is on directly contributing to national development and improving the quality of life for Thai citizens. [10] The purpose of the Offset Policy is to make the defence purchase more beneficial beyond just the procurement of military equipment, ensuring economic, technological, and social advantages for the country.

Approval granted for a 100 billion baht economic incentive tied to the procurement of Gripen military jets