The term offset is an English word that is used to mean compensate or the act of counterbalancing. Offsetting is used in various fields depending on the different scenarios.
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For instance, it can be used in the business world when a person settles a debt. In this report however, offsetting will be discussed in the line of military, whereby a comparison between the Brazilian and UAE offset programs in the defense system will be made.
In defense, an offset program is initialized with the aim of compensating the local industry with that from the foreign countries. In simple terms, an offset program entails getting defensive support from foreign contractors. “Offsetting provides an opportunity for purchasing governments to impose compulsory inward investment obligations on foreign suppliers” (Dempsey, 2011, p.1).
Among the many nations that have the offset programs is Brazil, which is located in South America. Despite the fact that Brazil is a peaceful nation, it has been able to dominate armed forces from America (Mitra, 2009, p.1). “The underlying policy by the Brazilian government is that the nation should be able to provide enough security for its citizens without having to deploy security personnel from other nations” (Mitra, 2009, p.1).
In a bid to achieve this goal, the Brazilian government has put in place funds to ensure that they purchase the latest military technologies from the foreign and expert countries like Japan. Research indicates that Brazil has been able to acquire the technologies “through such methods as licensed production, co-production and joint ventures although it has formally articulated its offsets policy quite recently” (Dempsey, 2011, p.1).
In all the aforementioned methods of technology acquisition, transfer has been the main mode of acquiring the offset program in Brazil. The major aeronautic company known as Embraer Corporation having been established in the year 1969 has proved to be the best offsetting program in the military industrialization.
This can be supported by the fact that Embraer has effectively absorbed and indigenized the foreign technologies as a way of offsetting the foreign deals.
In addition to this, Brazil has proved to significantly participate in the offsetting program through its importation of ammunition and the small arms that have been licensed in Italy, Britain, and Belgium among others. At the same time, Brazil is slowly becoming one of the leading manufacturers of firearms although it has not been given the authority to license them, hence using other nations that have the authority to do so.
On the other hand, the UAE has also established an offset program that is deemed to have been founded in 1992. Just like in Brazil, the offset program is aimed at establishing joint ventures at the local sector with those from international contractors and or members.
Research done indicates that a high percentage of the UAE citizens have been able to become shareholders the public joint stock companies. This has in turn led to increased power in the offset programs of the UAE. The main achievement of the UAE offset program is the ability of the government to be able to easily purchase and supply goods and or services through the aid of the local agents within the region.
With the main objective of the UAE Offset program being to diversify the economy of the UAE; this has been effectively achieved through enabling the ease and access of market and technology within the region and from abroad (Offset Program Bureau, 2011, p.1). As such, this has in turn created employment opportunities among the nationals of the UAE.
Dempsey, A. (2011). Don’t Fear the Offset. Web.
Mitra, A. (2009). A Survey of Successful Offset Experiences Worldwide. Journal of Defence Studies 3(1), 1-3. Web.
Offset Program Bureau. (2011). Defense Contractor: Offset Guidelines. Web.