South Korea’s defence budget is on a trajectory to reach $54.7bn by 2029, an increase driven by escalating tensions with North Korea.
South Korea’s escalating defence expenditure, projected to grow from $45.2bn in 2024 to $54.7bn in 2029, highlights an effort to counteract the persistent threats from its northern neighbour. According to an analysis of South Korea’s defence market by GlobalData, a leading data and analytics firm, this financial commitment is part of a broader strategy to strengthen South Korea’s security posture and modernise its military assets.
GlobalData’s report, “South Korea Defense Market Size and Trends, Budget Allocation, Regulations, Key Acquisitions, Competitive Landscape and Forecast, 2024-29,” delves into the factors driving this surge in defence spending. Despite a dip from $46.2bn in 2021 to $42.3bn in 2022, the budget rebounded to $45.2bn in 2024, reflecting renewed prioritisation of defence by South Korean policymakers.
A portion of this budget is earmarked for the acquisition of modern defence equipment, which is expected to rise from $13.4bn in 2024 to $16.5bn in 2029. These funds will support the procurement of platforms such as the F-35 aircraft and missile defence systems like the Korea Air and Missile Defense (KAMD). Enhancing naval capabilities, including the deployment of additional Aegis destroyers, is also a key focus.
Rouble Sharma, an aerospace and defence analyst at GlobalData, underlines the importance of South Korea’s defence modernisation strategy. “Korea also aims to create a robust domestic defence industry that not only caters to the needs of its armed forces but also positions itself as a formidable player in the global defence markets.”
South Korea’s efforts to develop indigenous defence platforms, such as the KF-21 aircraft and KSS-III submarine, are central to its goal of technological self-sufficiency.
At the Farnborough International Airshow 2024, South Korea’s Hanwha Aerospace unveiled plans to develop an indigenous fighter jet engine to compete with established models like the GE F414.
These projects enhance the country’s military capabilities while creating opportunities for international exports and industrial partnerships. Recent successes include exporting defence platforms to nations like Poland, Australia, and India.
As North Korea continues to conduct missile tests and expand its nuclear capabilities, South Korea’s military modernisation becomes even more critical. The country’s reliance on domestic defence companies to supply modern platforms and weapon systems is expected to grow, alongside a focus on export opportunities to achieve economies of scale in defence production.
GlobalData’s South Korean defence market intelligence provides a detailed look at the future of South Korea’s defence landscape, offering information for stakeholders and decision-makers in the defence industry. The report highlights the investments South Korea is making to ensure its security and stability in an increasingly volatile region.
