When the Jangbogo submarine was commissioned in 1993, South Korea was the 43rd country in the world to operate submarines. In just over 30 years, the nation has entered the competition for Canada’s next-generation submarine project, valued at 60 trillion won. This is not merely participation; South Korea has formed a competitive duo with Germany's ThyssenKrupp Marine Systems (TKMS). Given the historical challenges faced by South Korea's shipbuilding and defense industries, this marks a significant transformation.
Currently, the Canadian Patrol Submarine Project (CPSP) has narrowed down to a two-way competition between the Hanwha Ocean and HD Hyundai Heavy Industries 'one team' and Germany's TKMS. Both the government and industry insiders view the odds as essentially '50-50.' Germany is a leading submarine nation and provided technological assistance during South Korea's early submarine development, which is why Chief of Staff Kang Hoon-sik described the situation as 'not easy.' The final contractor selection is expected to be announced next month, marking a crucial turning point in South Korea's defense history.
Some analysts suggest that South Korea has an advantage. The competitiveness of K-defense, demonstrated through systems like the K9 self-propelled howitzer, Cheonmu, FA-50, and KF-21, has been validated in the global market. Additionally, South Korean submarines are highly regarded for their operational capabilities, delivery timelines, and cost-effectiveness. Notably, Canadian naval officials have participated in training with South Korean submarines to assess their performance.
This bidding process reflects the recent trends in the global defense market. Defense procurement is no longer just a business-to-business (B2B) transaction; it is evolving into a government-to-government (B2G) industry. This shift signifies a complex interplay of military power, security, supply chains, and diplomacy.
In fact, the outcome of the Canadian submarine project will not be determined solely by performance. Local industrial cooperation, offset agreements, supply chain investments, and job creation are emerging as key variables in the 'package proposal.' The involvement of Hyundai Motor Group Chairman Chung Eui-sun as part of the special envoy is significant. The Canadian government has requested cooperation in the automotive and hydrogen sectors, prompting Hyundai to provide support, with other industries like Korean Air also joining in.
If South Korea succeeds in securing the Canadian submarine contract, the implications extend beyond a mere 60 trillion won in revenue. It would elevate the country to a status where it exports submarines, often referred to as the 'ultimate weapon,' alongside ground weapons, missiles, and fighter jets. This could symbolize South Korea standing shoulder to shoulder with global defense powerhouses like the United States, Germany, and France.
It is only natural that the government is fully supporting this endeavor. Chief of Staff Kang Hoon-sik has personally visited Canada in a special envoy capacity, and the Ministry of Trade, Industry and Energy, along with the Defense Acquisition Program Administration and industry players, are working in concert. This is a necessary action from the perspective of national strategic industries. The government must also consider additional support measures, including financial assistance and diplomatic channels.
However, there are cautionary points to consider. An overemphasis on export-driven policies that impose excessive sacrifices on companies unrelated to the project is not advisable. While offsets are important, it is crucial that not all companies are coerced into 'semi-mandatory support.' In national strategic projects, balancing market principles with corporate autonomy is vital.
The opportunity now before South Korea was unimaginable during the introduction of the Jangbogo submarine. A strategic approach that maintains principles and balance while fostering public-private collaboration is essential. The results of the Canadian submarine project, to be announced next month, are anticipated to be a historic turning point for K-defense.
* This article has been translated by AI.
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