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June 9, 2015

US approves $1.91bn Aegis Combat Systems sale to South Korea

The US State Department has approved a possible foreign military sale worth approximately $1.91bn to the Republic of Korea for Aegis Combat Systems and associated equipment, parts, and logistical support.

By Samseer M

The US State Department has approved a possible foreign military sale worth approximately $1.91bn to the Republic of Korea for Aegis Combat Systems and associated equipment, parts, and logistical support.

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What is driving and impacting South Korea’s Defense Market?

South Korea’s defense budget is currently valued at $48.3 billion after experiencing impressive and robust annual growth of 10.5% in 2022. Over the forecast period, South Korean defense expenditure is anticipated to register a strong CAGR of 6.3% over 2023-27 and reach $66.2 billion by 2027. The country’s acquisition budget, which includes research and development (R&D) funding, is also anticipated to register significant growth, projected to reach $21.6 billion in 2027, seeing significant rise from the anticipated $17 billion in 2023. South Korean defense spending is continuing to be fueled by the country’s hostile relationship with North Korea, coupled with the need to develop its own domestic industry. If you want to strategize successfully off this growing market, it is important to be fully informed. This report’s key findings include:
  • Details on the defense budget
  • Drivers of defense spending
  • Key trends impacting the market
Download the full report so you can formulate winning strategies for the road ahead.
by GD50 ADS
Enter your details here to receive your free Report.

The Defense Security Cooperation Agency has notified Congress about the possible sale.

Under this proposed deal, South Korea will receive three Aegis shipboard combat systems, three MK-41 vertical launching systems, three common data link management systems, and three AN/UPX-29(V) identification friend or foe interrogators.

The scope of the delivery also includes spare and repair parts, support equipment, publications and technical documentation, as well as personnel training, training equipment, tool and test equipment. US Government and contractor technical, engineering, and logistics support services will also be provided.

With the new Aegis Combat System, South Korea will be able to enhance capabilities of its naval ships to defend against possible aggression, and protect sea lines of communications.

"With the new Aegis Combat System, South Korea will be able to enhance capabilities of its naval ships to defend against possible aggression."

It will support the Korean Navy’s efforts to upgrade its shipboard combat and ballistic missile defence capability.

This new development will also help the US to support security and defence needs of its ally and partner nation, which is a major political and economic power in East Asia and the Western Pacific.

In addition, it will enable US to help South Korea in develop and maintain strong, operational self-defence capabilities.

If approved the principal contractors for the deal will be Lockheed Martin Maritime Systems and Training, Raytheon Company, and General Dynamics Armament Systems.

The Aegis Ballistic Missile Defense (BMD) system integrates the SPY-1 radar, MK 41 vertical launching system, and SM-3 missile through an advanced command and control system.

Aegis BMD-equipped ships use hit-to-kill technology to intercept and destroy short and medium-range ballistic missiles.

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Free Report
img

What is driving and impacting South Korea’s Defense Market?

South Korea’s defense budget is currently valued at $48.3 billion after experiencing impressive and robust annual growth of 10.5% in 2022. Over the forecast period, South Korean defense expenditure is anticipated to register a strong CAGR of 6.3% over 2023-27 and reach $66.2 billion by 2027. The country’s acquisition budget, which includes research and development (R&D) funding, is also anticipated to register significant growth, projected to reach $21.6 billion in 2027, seeing significant rise from the anticipated $17 billion in 2023. South Korean defense spending is continuing to be fueled by the country’s hostile relationship with North Korea, coupled with the need to develop its own domestic industry. If you want to strategize successfully off this growing market, it is important to be fully informed. This report’s key findings include:
  • Details on the defense budget
  • Drivers of defense spending
  • Key trends impacting the market
Download the full report so you can formulate winning strategies for the road ahead.
by GD50 ADS
Enter your details here to receive your free Report.

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