DAPA CREATES NEW TOMORROWS
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Korea as a nation has an obligation to promote its defense industry, but the supporting policies are still in their infant stage. Over the past 50 years, the defense industry has been regarded as a ‘dependent variable’ for the acquisition of weapon systems, while efforts have been spared in establishing conducive infrastructure and implementing new policies. It is important that the government takes decisive steps to nurture the defense industry represented by high growth potentials as the industry addresses cutting-edge technologies of the 4th industrial revolution (UAV, Autonomous driving, etc), witnesses high growth trend and encourage employment thanks to the production of diverse products in small quantities. Furthermore, it is necessary to establish a legal basis and execute bold regulatory reforms in order to shape a sound and healthy ecosystem and secure global competitiveness.
DAPA has established four core policy directions to promote the defense industry.
We intend to remove existing obstacles to R&D so that defense companies can lead the 4th industrial revolution and enhance productivity.
To this end, we intend to designate projects that have a significant impact on national security or that are considered pivotal at a national level, as "national-policy projects". We will reduce fines caused by delivery delays and transform the existing price-based, low-cost bidding structure into a technical-oriented.
The government and system companies create requirements for product localization and defense procurement, while small/medium-sized enterprises and venture companies develop weapon systems that meet these requirements. The favorable cycle shaped through regulatory reforms will secure revenues and enhance technical capability for the manufacturers, strengthen cooperative tie between large and small/mid enterprises and expand the scope of overall defense industry.
Due to the limited demands of the domestic market, it is urgent for our defense industry to advance to international markets. However, the nature of defense industry makes it difficult for a company alone to promote exports as defense trades generally take place based on mutual trust between the governments involved. This calls for a government-to-government collaboration. In order to facilitate this process, 'Intergovernmental Agreement System (G-to-G)' will be established in order to swiftly respond to the demands by purchasing countries. The system will stipulate that DAPA will directly sell defense articles if requested by a purchasing government. The G-to-G system is advantageous to utilize the follow-on logistics support of an exported weapon system as a starting point of secondary export.
DAPA will promote the establishment of Defense Industry Promotion Agency in attempts to secure competitiveness and export capabilities of small/mid-sized/venture businesses and create high-quality jobs in a systematic manner.
In addition, DAPA will promote the establishment of Mutual Aid Association in order to resolve managerial difficulties through mutual guarantee/support among defense companies and create conditions for autonomous economic activities.