South Korean Defence Minister Jeong Kyeong-doo has outlined plans for the country to spend more money on locally produced defence products to help industry overcome difficulties related to the Covid-19 pandemic.
South Korea is rolling out plans to increase local production of components on key platforms such as Hyundai Rotem’s K2 main battle tank (Janes/Kelvin Wong)
In a meeting with defence industry CEOs on 15 June, Jeong said the South Korean Ministry of National Defense (MND) is rolling out several new initiatives including “financial support to ensure business conditions for defence companies”, as well as adjustments to existing equipment delivery schedules and new exemptions on penalties for late payments.
Jeong added that the MND also plans to adjust its spending plans based on its continuing efforts to replace imported defence platform components and systems with locally developed and built products.
“We are putting efforts [into] spending more on purchasing arms from local companies instead of buying from abroad when drawing the budget plans for next year,” Jeong said.
In pointing to efforts to support local supply chains, Jeong said the MND planned to expand its programme to establish “defence industry innovation clusters”. The first such cluster was set up in April in the southeastern city of Changwon and the MND is expected to launch several more in the next few years.
The Changwon project is supported through an initial government investment worth about USD37 million. The funding, which will be made available to industry and research institutes, will be used to support regional collaboration in research, development, and production.
A focus of the cluster project is to support small enterprises, with an emphasis on replacing components and systems that are currently imported.
Looking to read the full article?
Gain unlimited access to Janes news and more...
