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In this paper, a model for a continuously degrading system is developed such that an optimal inspection-maintenance strategy can be derived. The model is capable of handling the situation when there is deferment of the maintenance services. Hence, the system manager can decide whether to stop system operation during the waiting time for the maintenance services. The system is subjected to two degradation sources: 1) the degradation due to the operation of the system; 2) the degradation due to the operation environment. An optimal value of the inter-inspection time and an optimal maintenance threshold are then obtained by numerical methods such that the average availability of the system is maximised. 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