South Korea is offering its shipbuilding industry to strategically strengthen the American navy. The country also wants to cooperate on the LNG export project in Alaska.
South Korea’s Minister of Trade and Industry Ahn Duk-Geun met with US Secretary of Commerce Howard Lutnick last week to discuss closer cooperation in the shipbuilding and technology sectors. After the meeting, Ahn announced that a task force for shipbuilding cooperation would be set up involving various ministries, including the Ministry of Foreign Affairs and the Ministry of Defense. The USA also wants to set up a corresponding working group.
According to Business Korea, Ahn has offered the US priority access to high-demand construction sites at South Korean shipyards for bulk orders of warships. This also applies to tankers and icebreakers. Officially, the three large South Korean shipyards are working to capacity until 2027/28. In return, the USA is to guarantee exemptions from the planned US tariffs.
Great interest in South Korea’s shipyard
The Trump administration is showing great interest in South Korea’s shipyard capacities. Due to delays in the supply chain and a shortage of skilled workers, the US Navy is struggling with significant cost and schedule overruns in almost all major shipbuilding programs. This has primarily affected the Freedom-class Littoral Combat Ships (LCS), the San Antonio-class amphibious transport docks and the Expeditionary Fighting Vehicle (EFV), which has now even been stopped.
South Korea, the world’s second largest shipbuilding nation, has state-of-the-art shipyards with efficient production capacities for civilian and military ships. The three largest shipyards – Hyundai Heavy Industries (HHI), Hanwha Ocean (formerly Daewoo) and Samsung Heavy Industries (SHI) – are leaders in the development of naval vessels, including Aegis destroyers, submarines and patrol vessels.
HHI has built the Sejong-daewang class (KDX-III), among others, while DSME supplies modern frigates and submarines for South Korea and international customers. SHI is primarily active in specialty shipbuilding. Thanks to automated production lines, modular construction and state-of-the-art robotics, South Korean shipyards work much more efficiently than their US counterparts.
Another key object of negotiation is the participation of Japan and South Korea in the stagnating Alaska LNG project, which is intended to tap into the natural gas reserves of the North Slope. An 800-mile (1,287 km) pipeline is planned to transport the gas to Nikiski, where it will be liquefied and exported mainly to Asia.
The $44 billion (€40.4 billion) project could supply up to 20 million tons of liquefied natural gas per year and would help Japan to reduce its dependence on the Middle East and offset its trade deficit with the USA. Japan and South Korea are to enter into long-term purchase agreements for LNG quotas as part of the project and also make major investments in infrastructure, according to reports. (rup)
