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procurement programmes either in the form of
Foreign Military Sales (FMS) or Direct Commercial
Sales (DCS). South Korea’s purchase of foreign
defence equipment has continued to grow since
2018 with the government pursuing large scale
programmes such as the F-35A next genera-
tion fighter jets, and high-altitude aerial systems
(HUAS).

The latest data from the Defence Acquisition
Programme Administration (DAPA) shows that
the total volume of weapons South Korea
acquired through foreign purchases from 2016
to 2020 was about US$11.807 billion. More than
half of it was acquired through FMS programmes
valued at US$6.281 billion.

Meanwhile, the total volume of weapons South
Korea acquired through foreign DCS pro-
grammes during the same period was about
US$5.526 billion in value and 53 per cent
(US$2.928 billion) of it was purchased from the
United Sates. Recently, the government had also announced a plan to launch a
private-public consultative body to help increase overseas arms
Stocks on the Rise sales.

South Korean defence stocks have been bull- From the government’s side the authorities are strengthening the
ish over the past 12 months. Shares of Hanwha industrial basis that supports the defence industry export. The gov-
Aerospace, a subsidiary of South Korean con- ernment is putting forward efforts to institutionalise early on the
glomerate Hanwha Group, saw a whopping 66 defence exports follow-up-logistics support systems, which entails
per cent rise since the start of the year, and a providing logistical support elements, such as materials, facilities,
nearly 90 per cent surge in the last 12 months. and personnel, to partner countries.
The company makes air defence systems,
armoured fighting vehicles and artillery systems. Also, other efforts to enhance the industrial foundations in sup-
Similarly shares of Hyundai Rotem have gained port of defence exports, including the development of defence
over 20 per cent in the last 12 months.
export-import support information system in order to provide real-
time defence industry trends and marketing information exchange
What’s Keeping the Interest? among relevant offices, are being put forward.

Escalating tensions in the Korean Peninsula have
also kept interest in South Korean weapon plat- However, despite the progress made by South Korea’s defence indus-
forms high. Some of those systems have found try, challenges still remain. Many key sub-systems for the weapons
their way into markets like the Middle East and are still imported. Propulsion systems in the K2 and K9 both include
Europe, the latter as a result of the Ukraine war. German designs and the FA-50 aircraft uses General Electric’s F404
turbofan engines.

The government has vowed to draw up a road- Research analysts Haena Jo and Tom Waldwyn of the IISS noted
map before year end on the development of that as exports grow, South Korea will likely need to develop a more
materials and components needed for the robust arms control process that could include end-user inspections.
defence industry, and to enhance cooperation “Previous contracts have allowed some customers to market South
with foreign defence companies. Korean designs elsewhere with few or no limits. Indonesia sold four
amphibious vessels to the Philippines after having first acquired
them from South Korea as part of a programme for its own navy,
South Korea plans to invest 278.1 billion won this and Poland’s donation of Krab howitzers to Ukraine did not require
year in research and development projects to South Korean approval. It seems likely that this freedom for cus-
be conducted jointly by private firms and the tomers to generate their own exports may have been a key selling
point,” they opined..
military.

32 | SEPTEMBER-OCTOBER 2023 WWW.GBP.COM.SG/ADT