Presidential Chief of Staff Kang Hoon-sik appears likely to visit Canada as President Lee Jae-myung's special envoy for strategic economic cooperation in defense (defense industry envoy). The trip is meant to support Korean defense companies participating in Canada's 60 trillion won submarine acquisition program.
According to the defense industry and the presidential office on the 8th, Kang plans to visit Canada as a defense industry envoy late this month or early next month. A presidential office official said, "The detailed schedule has not yet been finalized," and "We are coordinating the visit schedule together with our defense corporations and Canada." An industry official also said, "It is true that a delegation is being formed," adding, "We were surprised that the Canadian government was even more proactive."
President Lee appointed Kang as a defense industry envoy on Oct. 10. At the time, Presidential Office Spokesperson Kang Yu-jung said, "The Lee Jae-myung administration is building a 'defense industry control tower' that oversees the entire presidential office to realize the goal of becoming one of the world's four leading defense powers, a national policy task, and is pursuing a defense industry development strategy that includes export support," adding, "To responsibly discuss comprehensive support measures in security and the economy with defense export destination countries, the president appointed Kang as a special envoy."
The presidential office said Kang plans to carry out three rounds of defense envoy trips through the first half of next year. In October, he first visited Europe, including Poland and Romania, and in November, he visited the Middle East, including the United Arab Emirates (UAE) and Saudi Arabia. This visit to Canada would be the final leg of the defense envoy itinerary.
The defense industry has high expectations for Kang's visit to Canada. The Canadian government is pursuing a 60 trillion won submarine acquisition program. It is a large-scale project to introduce 12 submarines in the 3,000-ton class. Hanwha Ocean and HD Hyundai Heavy Industries were included in the shortlist announced in August by the Canadian government. The Canadian government plans to select the final contractor next year.
A senior defense industry official said, "For a project of this scale, it should be seen as impossible to win the order without government-level support," adding, "If Kang can clearly explain and resolve what the Canadian government needs, the chances of our corporations winning the order—given that they do not lag in technology—will increase."
Once Kang's defense envoy activities wrap up, the government is also expected to announce a fund to promote coexistence between large and small and medium-sized companies in the defense sector. The idea is that when a major defense company succeeds in exports thanks to government order-support activities, including the defense envoy, the company would contribute a set percentage of the export amount to the fund, which would then be used to help small and medium-sized companies and startups in the defense field. The specific size of the fund will likely be decided after Korean defense companies achieve actual export results in Poland, Romania, the UAE, Saudi Arabia, Canada, and elsewhere.
Before beginning his envoy activities, Kang wrote on Facebook, "The government plans to review a virtuous-cycle system in which it provides tangible and intangible support to secure defense companies' export confirmations, and companies, in turn, allow more people to share in the added value—national wealth—created through government support," adding, "In the case of warships, defense exports have a large ripple effect, with about 300 first-tier partner firms for each large corporation."
President Lee also said at a defense industry development forum on Oct. 10, "The (large corporations) side that already has an enormous vested structure is likely to have received considerable benefits from the government of the Republic of Korea. From the standpoint of fairness, I think we need to grow many seedlings," adding, "We may need to provide more support and strength to startups and small and medium-sized enterprises."