Industry minister highlights Korea's competitive edge in Canadian submarine project race

Industry Minister Kim Jung-kwan speaks at a press conference held in Sejong, Wednesday. Courtesy of Ministry of Trade, Industry and Resources

Industry Minister Kim Jung-kwan has underscored Korea's competitive edge in the ongoing race to win Canada's high-profile submarine project, highlighting the country's manufacturing capabilities and contributions it can make to Canada's automotive sector.

Kim made the remarks in a press conference held Wednesday as Seoul awaits Canada's planned announcement of the preferred bidder for the estimated 60 trillion-won ($40 billion) project to build as many as 12 new conventionally powered submarines, which is scheduled for late next month.

The Korean consortium, comprising Hanwha Ocean and HD Hyundai Heavy Industries, is one of the two final contenders for the high-profile project, alongside Germany's Thyssenkrupp Marine Systems.

Kim said Seoul can supply the KSS-Ⅲ class submarines, an "existing" and already operation model, while Germany is still designing its submarine for Canada, stressing that the Korean submarine offers much better features and price competitiveness.

Last week, the 3,000-ton ROKS Dosan Ahn Chang-ho, a KSS-Ⅲ class boat, arrived at a port in Canada for joint drills with the Royal Canadian Navy. It sailed some 14,000 kilometers across the Pacific Ocean, showcasing the Korean naval submarine's ability to carry out long-distance missions.

Long endurance is an appealing feature of the Korean sub as Canada's navy has to patrol vast stretches of the Pacific, Atlantic and Arctic oceans.

In terms of broader industrial cooperation, Korea also has an upper hand over Germany, with major Korean companies, including Hyundai Motor and Hanwha Group, having proposed collaboration on creating a hydrogen mobility ecosystem and securing military vehicles for Canada, Kim explained.

"When I visited Canada earlier in May to meet my Canadian counterpart, Melanie Joly, she said she is not supposed to hold a meeting with me because of a fairness issue, but she did, and the meeting itself is a message," he said, showing cautious optimism over the Canadian submarine deal.

"But we cannot let our guard down until the very end because Canada is a member of the North Atlantic Treaty Organization (NATO) and it could make a strategic decision in favor of its long-standing European partner," he added.

Regarding ongoing talks on Seoul's envisioned investment in the United States under the bilateral trade deal finalized last year, the minister said it is difficult to determine when the first project will be announced as commercial feasibility of the candidate projects should be thoroughly assessed.

"We are working hard on this matter, and compared with the tension seen in U.S. President Donald Trump's social media post earlier this year, negotiations with the U.S. are currently being discussed in a much more constructive manner," he said.

In January, Trump had threatened to raise reciprocal tariffs on Korean goods back to 25 percent from 15 percent, citing a delay in Seoul's legislative process needed to facilitate the implementation of the Korea-U.S. trade deal, under which Korea pledged to invest a combined $350 billion in the U.S.

On the economic front, Kim forecast Korea's exports will surpass the landmark $900 billion mark this year for the first time ever.

Korea's exports reached an all-time high of over $700 billion last year on the back of strong semiconductor exports.

In the first four months of this year, the country exported a combined $306.5 billion worth of goods, the highest ever figure for the three-month period.

"People say exports are being driven by semiconductors, but exports in other sectors also rose by 13 to 15 percent," the minister said, stressing that various sectors are delivering strong performance under current circumstances.

Kim said the government will work to continue this strong export momentum to make Korea the fifth-largest exporter in the world.