South Korea's Defense Budget: A Move Toward Self-Reliance

Since winning election in May, South Korean President Moon, Jae-in has made self-reliance a defense imperative.  Although South Korea’s most recent defense budget proposal was submitted by the Ministry of Defense (MND) only after a month assuming office, President Moon’s priorities seem already present and foretell his ambitious efforts to modernize and transform the Republic of Korea’s (ROK) armed forces.  The appointment of Suh, Choo-suk as his vice defense minister further reinforces Moon’s commitment to independence from the Unites States and is evidenced in current and mid-term defense plans.

After DRP 2020 was unveiled, subsequent administrations have substantially revised the plan, to include subtracting capabilities associated with C4ISR and Precision Guided Munitions capabilities, subtracting from those capabilities and adding strike or delivery platforms.  To restore the reform agenda raised in the original DRP 2020 plan, it is highly expected that the Moon administration will emphasize an integrated command control system with ISR platforms.

This year’s defense budget proposal is approximately 43.71 trillion Korean Won ($38.7 billion), an 8.4% increase from 2017’s $34.77 billion.  The increase is slightly above average in comparison to past proposals (7.2% in 2017) and reflects the MND’s clear desire to submit more fiscally realistic requests for both its Mid-Term Defense Plan and the annual defense budget.  By law, the National Assembly must approve the final version of the defense budget by December.

The two primary components of the proposal are the Operations and Maintenance budget (O&M) and the Force Improvement Program (FIP) budget.  The FIP budget proposal, which is an 11.6% from the previous year strongly indicates President Moon’s national defense strategy as the FIP priorities include the early deployment of the three retaliatory defense systems: Kill Chain, Korean Air and Missile Defense (KAMD), Korea Massive Punishment and Retaliation (KMPR) along with significant investment in Defense Research and Development (R&D) programs.

Fulfilling its ongoing defense modernization, the MND is entering the peak period of payments for multiple high-cost programs.  The latest proposal reflects the need to commit a significant portion of the FIP budget towards funding for the F-35A Joint Strike Fighter, Global Hawk, Patriot PAC-3 upgrade, and the Aerial Refueling Tanker.  Moreover, to accomplish Moon’s long-term defense plan, the ROK’s FIP budget will likely continue to require significant increases for the remainder of the decade for its commitment towards self-reliant armed forces.

FIP Budget Breakdown:

Classification

2017 Budget

2018 Budget

Change from 2017

% Increase

NK Nuclear/WMD Response

$2.99B

$3.23B

$0.23B

7.8

--Kill Chain/KAMD/KMPR

$1.51B

$1.45B

$0.07B

4.3

--Supporting Platforms

$1.48B

$1.78B

$0.30B

20.3

Local Provocations

$1.17B

$1.41

$0.23B

20.0

Self-reliant National Defense

$5.23B

$5.88B

$0.65B

12.4

Defense R&D

$2.46B

$2.72B

$0.26B

10.4

Table 1. Major FIP Proposals (Exchange Rate: 1 USD = 1,129.4 KRW)

The O&M budget implements the administration’s national tasks, such as enhancing the defense readiness posture along with improving welfare and living conditions for soldiers.  The 2018 O&M budget proposal for $26.65 billion is a 7.0% increase from the previous year’s $24.91 billion.  This year’s O&M budget proposal emphasizes improving the quality of life of military personnel and improving overall readiness of the ROK forces.  Especially, the salary of all enlisted soldiers substantially increased almost twofold from previous payment level.  The salary increase was an initiative raised as a campaign commitment by President Moon as part of improving soldier welfare in the military.

Under DRP 2020, the overall South Korean military manpower would be reduced significantly, but Seoul intends to counterbalance this by procuring advanced fighter jets (F-35A Joint Strike Fighter), surveillance aircraft (Global Hawk), and naval platforms (Aegis destroyer).  DRP 2020 calls to “replace nearly every outdated major weapon” and “transition to a more professional force with a smaller fraction of draftees.”  Simply put, Moon’s position on national defense strategy is depicted as a means of restoring national sovereignty, and it is highly probable to focus on building a self-reliant defense capacity for the next five years.

Christopher Lee is an active duty Major in the U.S. Army. He holds a B.S. from West Point and an M.A. from Columbia University. He is currently pursuing his Ph.D. in International Cooperation from Yonsei University. He has served for eight years as an intelligence officer, and is currently serving as a Foreign Area Officer for the Northeast Asia region. Chris can be reached via Twitter @chrislee733.

The views expressed are the author’s and do not reflect the position of the U.S. Army, the Department of Defense, or the U.S. Government.