South Korea launches new ‘localisation' plan

Funding allocated to DAPA's defence parts localisation programme has expanded sixfold in the past two years. (Janes)

South Korea's Defense Acquisition Program Administration (DAPA) has launched the latest version of its plan to increase the domestic production of components and systems for defence platforms.

DAPA said the new ‘2023−27 parts localisation plan' outlines a requirement for local industry to put more emphasis on next-generation technologies, including materials such as alloys and carbon fibres.

Under the plan, DAPA said it will provide research and development funding for priority components; increase the efficiency of procuring such components from local industry; and encourage more companies from civilian sectors to take part in the programme.

DAPA said the plan is intended to bolster exports and reduce dependency on imports. Another aim of the programme is to fill gaps in international supply chains and ensure the supply of capability to the Republic of Korea (RoK) Armed Forces.

Data from DAPA provided to Janes earlier in 2022 shows that the South Korean government has stepped up its parts localisation programme in recent years, allocating a sixfold increase in related funding.

According to the data, funding for parts localisation projects in 2021 was KRW88.6 billion (USD70.8 million), while in 2018 the figure was KRW14 billion. The data also shows that funding towards the objective has increased every year since 2016.

In addition, the number of projects dedicated to parts localisation grew to 51 in 2021, more than the combined number of such projects between 2016 and 2020.

DAPA has told Janes