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The Stance of the SFTE “Spetstechnoexport” Regarding the Information Published by Media about the Allegedly Overestimated Cost of BMP-1
11.04.2019

In the context of the investigation conducted by the Central Investigation Department of the State Office of Public Prosecutor of Ukraine in relation to the SFTE “Spetstechnoexport” regarding the alleged inflated value of the purchase of BMP-1 infantry fighting vehicles for the needs of the Armed Forces of Ukraine under the state defense order, we hereby announce the following.

The cost of the offer provided by the SFTE “Spetstechnoexport” to the Ministry of Defense of Ukraine regarding the supply of BMP-1 to Ukraine was the lowest among the proposals of both other importers and domestic suppliers.  Unfortunately, according to the terms of the state contract with the Ministry of Defense of Ukraine, we are not allowed to disclose the cost of the delivered infantry fighting vehicles. However, we can note that the price of one BMP-1 after overhaul and with zero haulage delivered by our company from the European Union is equivalent to the cost of the Defence Ministry of Ukraine only on the repair of one of its own armored vehicle. We emphasize that the cost of delivered BMP-1 also included warranty maintenance of all new armored vehicles by Petralink Limited on the territory of Ukraine for a long time of their operation. This work is still performed by the representatives of the foreign company; unfortunately, not all journalists take such special terms into account. 

A commercial offer confirming the readiness to supply BMP-1 for the needs of the Ministry of Defense of Ukraine came to the SFTE “Spetstechnoexport” from Petralink Limited directly in April 2017. Taking into account the condition and completing units of armored vehicles, the cost of the contract concluded with Petralink Limited for the supply of BMP-1 is profitable, which was confirmed directly by the owner of the equipment represented by the Ministry of Defense of Ukraine. 

At the same time, “Spetstechnoexport” sent all calculation and costing information related to the costs associated with the supply of this technology to the Ministry of Defense of Ukraine. The validity of the contract value was verified and agreed upon by the respective structural divisions of the SC "Ukroboronprom".

Additionally, when the Ministry of Economic Development and Trade has received the necessary information and documents from SFTE “Spetstechnoexport”, it included the SFTE “Spetstechnoexport” in the register of suppliers of the said equipment under the State Defense Order. 

As a result of comparing commercial offers of similar products from several suppliers and checking the calculation materials, the Ministry of Defense of Ukraine has concluded a State contract with the SFTE “Spetstechnoexport” for the supply of thirty units of BMP-1, as our company has offered the most favorable terms of delivery of this technology (takin in account the successful delivery of thirty BMP-1, an additional state contract was signed in 2018 for the supply of another twenty units of such armored vehicles). In pursuance of the state contract, the SFTE “Spetstechnoexport” entered into an external economic contract with a foreign company Petralink Limited, which, and we repeat it, was ready to put the necessary quantity of BMP-1 vehicles to Ukraine at the right time for the most favorable price and terms of service.

After obtaining the export license of the country for sending the specified products, the Ministry of Defense of Ukraine, together with representatives of our company, inspected the products before delivery, checking the technical condition of BMP-1 vehicles, completing units, documentation, specifications for capital repair and pre-sale preparation.

BMP-1 vehicles supplied by the SFTE “Spetstechnoexport” are equipped with ZIP 1:1 (spare parts, tools, accessories) and ZIP 1:10 group sets. Pre-sale preparation of these vehicles was fully carried out at a specialized enterprise of one of the countries of the European Union. 

As of today, taking into account the quality, completeness and timeliness of the supply of BMP-1 vehicles, the SFTE “Spetstechnoexport” has no claims to Petralink Limited. The terms of the contract are fulfilled in full, all BMP-1 vehicles have already been delivered to Ukraine in accordance with the contract, accepted by the customer without any remarks and operated by the Armed Forces of Ukraine.

Supply of BMP-1 vehicles by the SFTE “Spetstechnoexport” to Ukraine is still the only example of a successful full implementation of the contract for the delivery of large military armoured vehicles from the EU to Ukraine. Due to a number of political reasons, most companies with such armoured vehicles can not obtain export licenses for their shipment to Ukraine.

We appeal to journalists who are investigating purchases in the defence sphere of our state: if you have information about more advantageous offers of delivery of equipment of similar quality  to Ukraine, please send them to our email address so we could start negotiations with a potential supplier and prepare an official offer for the supply of such equipment, since the Armed Forces of Ukraine still experience a deficit of such vehicles.

We emphasize that the distribution of inaccurate or unconfirmed information on such procurement impedes the development of military and technical cooperation between Ukraine and foreign countries and may lead to the disruption of the supply of military equipment to Ukraine in the future. 

As we reported earlier, within 2018, the SFTE “Spetstechnoexport”, which is part of the State Enterprise "Ukroboronprom", delivered fifty BMP-1s to Ukraine, and there is still the shortage of these vehicles in the Armed Forces of Ukraine.
 



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