11 October 2011

Korea Secures $1.1 bil Submarine Deal With Indonesia

Korea has made its first step into the global submarine exports market by securing the country's largest single overseas defense contract. Korea's Daewoo Shipbuilding and Marine Engineering said on Monday that it will sign a contract with Indonesia next month to build submarines.

This marks the company's first export order for such a project and Korea's biggest overseas defense contract in terms of size. Under the 1.1 billion-US-dollar-deal.. DSME, the world's third-largest and Korea's second-largest shipbuilder will build three 14-hundred-ton, self-developed submarines for the Indonesian Navy.

Daewoo says it will coordinate details with Indonesia's defense ministry and conclude the deal by November. DSME had been bidding for the contract against competitors from France, Russia, and Germany. In June, Indonesia announced both Korea and France as the preferred bidders but it dropped France making the Korean shipbuilder the sole preferred bidder for the project.

Experts say the global market for exporting submarines holds a potential value of 200 trillion won, or nearly 200 billion US dollars over the next ten years.

Kim Han-ul, Arirang News.

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