Budget hampers procurement plans: Defense Ministry

Several military procurement projects, including one to acquire four aerial refueling tankers, are expected to be delayed or canceled due to budgetary constraints, as Seoul seeks to readjust its mid-term defense improvement plan, a source said Sunday.

The Defense Ministry has been drafting the defense plan for 2016-2020, which will be finalized next month. Following a legal revision, the ministry took over responsibility for drawing up the plan starting this year. Until last year, the Defense Acquisition Program Administration created the plan.

“Defense Minister Han Min-koo ordered his staff to consider financial constraints as the ministry draws up the defense plan. Thus, some procurement plans could be delayed or dropped even though the Joint Chiefs of Staff has already decided to push for them,” a military official told media.

Last year, the mid-term procurement plan for 2015-2019 was written on the premise that the state defense budget would increase 10.6 percent from a year earlier. But last year, the budget increased only 4.8 percent, making some of the acquisition plans unrealistic.

Some observers say that dozens of projects for the Army, Air Force and Navy may need to be readjusted in consideration of budgetary limits. Some of the projects for which no contract has been signed are likely to be canceled, they say.

“Budgetary pressure is quite considerable. Thus, there will be readjustments to defense projects and priorities. Obviously, uncertainty has increased over the prospect of some acquisition plans, though nothing has been confirmed as of yet,” said a defense official, declining to be named.

Among the projects to be delayed is Seoul’s 1.4 trillion won ($1.2 billion) project to introduce four aerial refueling tankers between 2017 and 2019. Seoul initially planned to announce the winner for the project in December 2014, but the winner is now expected to be picked in April or May, sources said.

Despite the pressing need to improve South Korea’s deterrence against North Korea’s evolving military threats, increasing defense spending for Seoul remains a tough task due to growing public calls to increase welfare.

The Defense Ministry has recently vowed to use cutting-edge technologies for military operations to enhance efficiency in its management of resources and personnel and help address budgetary impediments.

By Song Sang-ho (sshluck@heraldcorp.com)