Fiddich Review Centre
Sliver

The Next Big Arms Dealer in Asia?

Commentary

The international arms bazaar is not an equal-opportunity marketplace. There is no level playing field, even if market leaders like the United States, Europe, Russia, and a few others were not fixing the whole affair. Given high barriers to entry, it is hard for an aspiring arms exporter to break into the business.

Costs often have less to do with arms purchases than one might think. The cheapest weapons systems are often not the ones eventually chosen.

Even capability is often not a major factor in deciding which arms to buy from which supplier. For the most part, modern weapons—fighter jets, armored vehicles, missiles, warships—are pretty much the same. In terms of capabilities, they overlap considerably; any of them could “do the job.”

So why do certain buyers prefer certain weapons suppliers? In the first place, buyers often exhibit what can only be termed as “brand loyalty.” My Dad was a “General Motors” guy: his entire life, he bought only Buicks or Pontiacs; purchasing a Ford would never cross his mind. Arms-importing nations are often the same: they have preferred suppliers, and many militaries are prepared to shell out more money for a particular piece of kit, even if it is more expensive. Besides, in the world of arms dealing, prices are always negotiable.

Politics are also especially critical. For example, countries have traditionally bought arms from the United States to build up friendly relations and strengthen alliances. That is why so many countries worldwide have acquired F-16 fighter jets from the United States: it is a way for a nation to demonstrate its loyalty to Washington; in return, it expects a reliable defense commitment from the United States.

“Signaling” is another key element in political decision-making. For example, the United States, by supplying arms to a particular country—say, Taiwan or Ukraine—is sending a signal (in this case, to China and Russia, respectively) that Washington considers the security and territorial inviolability of these customers to be of utmost importance to the United States.

Finally, militaries prefer equipment with a proven reputation of potency and reliability. They especially like systems that have been “bloodied in battle.” This is why so many countries like to buy stuff from Israel; Israeli weaponry has a demonstrated effectiveness and ruggedness, which, above all, have been “combat verified.”

As a result, the global arms market has been remarkably stable for the past 20 years. In the mid-1990s, for example, the five largest arms exporters accounted for 83 percent of all international arms transfers, according to the Stockholm International Peace Research Institute. In 2021, the top five still held about 78 percent of the business. In fact, if the traditional key arms exporters are added together—the United States, Russia, China, Britain, France, Germany, and Italy—they collectively control all but around 16 percent of the current arms market.

There is not a lot of opportunity, therefore, for new suppliers to break in. Israel, for example, has carved out a lucrative niche for itself as a supplier of a few key pieces of military equipment—especially drones, antitank and air-defense missiles, radar, and electro-optical systems—but this has still been only enough to win a sliver (about 2.5 percent) of the total global market.

All these factors are why recent South Korean successes in the international arms market are so impressive. Despite high barriers to entry and market segments already saturated with highly capable competing products, the Koreans have chalked up some major sales in recent years.

Most of these sales have been limited to a few products but have been widely marketed. For example, South Korea has exported its K9 155mm self-propelled howitzers to at least eight countries, including Australia, Egypt, Estonia, Finland, India, Norway, and Turkey. Seoul has sold trainer aircraft to Indonesia, Peru, Senegal, and Turkey; submarines to Indonesia; and amphibious warfare ships to Indonesia, Peru, and the Philippines. Turkey is producing a homegrown tank with an engine and transmission used in Korea’s K2 Black Panther tank.

In particular, South Korea has recently broken into the highly competitive global fighter market. Seoul builds the T-50 “Golden Eagle” supersonic trainer/light attack jet, for which it has signed export agreements with Columbia, Indonesia, Iraq, the Philippines, and Thailand; altogether, these five countries are buying 90 various versions of the T-50.

But South Korea’s most momentous arms deal has been with Poland. Just this year, Seoul has signed multiple contracts with Warsaw for the sale of 180 K2 tanks, 212 K9 howitzers, 300 K239 Chunmoo multiple-rocket launchers, and 48 ground-attack versions of the T-50 fighter jet. Altogether, these sales are worth at least $9 billion.

Overall, South Korean aggregated arms sales for the period 2017-2021 increased by 177 percent over the previous five years. Altogether, Seoul captured 2.8 percent of the overall arms market, making it the world’s eighth-largest arms exporter, above Israel.

South Korean arms exports totaled $15 billion in 2022 and could reach $20 billion by year’s end.

Epoch Times Photo
A South Korean Air Force F-35A fighter jet takes off from the runway during the “Vigilant Storm” U.S.-South Korea joint aerial drill at Gunsan Air Base, South Korea, on Oct. 31, 2022. (South Korean Defense Ministry via Getty Images)

How has Seoul accomplished such a feat? To a considerable extent, the arms it sells are highly “commoditized,” meaning that they are characterized by common technologies or attributes rather than by brand or capabilities uniqueness. Commodities are largely marketed based on their price, and in this case, cheaper-but-still-quite-capable Korean weaponry has been able to undersell its competitors.

As Korea tries to move up the ladder to market more advanced, complex weapons systems, its advantages may dissipate. At the same time, South Korea’s strength has always been its near-boundless optimism, its ability to believe that if it perseveres and just tries harder, it can overcome any barrier or setback.

One of Seoul’s biggest challenges may be securing a roster of stable customers that it can count on for follow-on orders. It is not impossible for a small producer-state like Korea to construct a successful spot in the global arms market. Optimism alone, however, is not going to sell fighter jets.

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.

Richard A. Bitzinger

Follow

Richard A. Bitzinger is an independent international security analyst. He was previously a senior fellow with the Military Transformations Program at the S. Rajaratnam School of International Studies (RSIS) in Singapore, and he has held jobs in the U.S. government and at various think tanks. His research focuses on security and defense issues relating to the Asia-Pacific region, including the rise of China as a military power, and military modernization and arms proliferation in the region.

Source link

Related posts

LA Aims To Add Thousands Of Bus Shelters Across The City, But Their Plan Has ‘A Lot Of Ifs’

Mandy

Premier League: 10 things to look out for this weekend | Premier League

Mandy

Thoughts on the Upcoming Election | News, Sports, Jobs

Mandy

Leave a Comment