ABSTRACT
It is hard to classify offsets into a specific field of study due to its pervasive nature. In the field of international relations, offsets would be construed as a strategic tool used by an ally with mutual political and foreign relations interests. This underpinning is based on the fact that offsets is able to transfer the necessary technology and skills into buyer countries as part of international defence and security procurement with fewer restrictions. This would create a complex interdependence between the state and non-state actors informing allies (Keohane and Nye, 1987, pp. 725–753; Keohane, 2002, pp. 632–645; Keohane and Nye, 2011, p. 58) Therefore, offsets becomes an important tool to bridge the political gap and build defence cooperation in the context of international relations between countries. In the field of international political economy, it is argued that offsets are a political tool that is used to derive economic benefit (Crane and Amawi, 1997, pp. 35–42). Offsets are a state-sponsored tool with direct government intervention to ensure that offsets contracts imposed on foreign contractors bring about economic and industrial benefits. This entails a hands-on approach from the state as to how offsets is used and distributed to enhance strategic sectors and communities to fulfil objectives (Escobar, 1995; Karagiannis, 2001, Blinder, 2002; pp. 17–47; Markwell, 2006, p. 53). Offsets analysed as a tool for development would fall into the field of developmental economics (Schumpeter, 1934, 1984; Meier, 1970, pp. 14–18, Preston, 1997, p. 34–45; Bernstein, 1971; pp. 141–160; Hirschman, 1958, pp. 12–18; Hunt, 1989, pp. 42–53; Sachs, 1992; Todaro and Smith, 2006, pp. 666–675; Ziai, 2007; Nafzinger, 2012). In this context, offsets is perceived to create activities for buyer countries that consist of technology transfers, innovation, investments, skills enhancement and export opportunities which could result in greater earning power, jobs that lead to higher earning capacity and highly skilled manpower, thus overall providing greater socio-economic impact. Offsets is also associated to the field of defence economics as the costs and benefits of offsets activities’ are evaluated and whether offsets truly contribute to economic growth and development (Kennedy, 1975). Offsets could also be studied as part of public policy, mainly analysing offsets policy formulation, process and implementation (Lall, 1996). Finally, offsets is also an important subject within the field of 46international business and international trade, especially for companies operating in an export market and entering into international collaboration. Offsets can be used as a strategic tool incorporated by companies into their corporate strategy to gain competitive advantage over their competitors in winning sales and business (Peng and Meyer, 2016, pp. 111–152; Klohs, 2012, pp. 27–34; Hill, 2014, pp. 453–455).
