Defense Exports Likely to Keep Increasing
Hanwha Corp. signed a 984.6 billion won contract with the Ministry of Defense of Saudi Arabia on March 8 after Hanwha Defense signed a two trillion won contract with the government of Egypt last month to export K-9 howitzers. The item and the other specifics of the former contract are confidential.
That day, Poongsan signed an ammunition supply contract with the Ministry of Defense of Saudi Arabia. The amount of this contract is 150 billion won. In addition, LIG Nex1 and the ministry signed an interception system-related contract worth 82 billion won. The company concluded a US$3.5 billion missile supply contract with the United Arab Emirates in January this year and is expected to sign the same contract with Saudi Arabia.
According to industry sources, South Korean defense companies’ exports are likely to keep increasing. “Middle Eastern states are seeking alternatives with Russian weapons exports predicted to be blocked,” one of them said, adding, “U.S. weapons exports to Saudi Arabia have been banned since February last year for its participation in the civil war in Yemen.”
South Korean defense companies’ annual exports are estimated to exceed US$10 billion this year. For reference, the annual amount was about US$3 billion in the 2010s and jumped to US$7 billion last year.