Protracted negotiations delay S. Korea's massive fighter jet project

By 송상호

Published : Oct. 29, 2012 - 20:43

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South Korea's plan to purchase 60 advanced combat fighters is expected to roll over into next year as negotiations have dragged on, with the next government widely expected to complete the multi-billion dollar project after December's presidential election, according to procurement officials Monday.

The F-35 Joint Strike Fighter by Lockheed Martin, the F-15 SE Silent Eagle by Boeing and the Eurofighter by Europe's multinational defense group EADS have been vying for the fighter jet purchase program that could worth up to 8.3 trillion won (US$7.3 billion) since last year.

Although the Defense Acquisition and Procurement Agency (DAPA) earlier announced that it would pick a successful bidder in October, it had been widely expected that the agency could not meet the proposed timeline considering protracted testing procedures.

According to the DAPA officials, negotiations are currently under way to discuss contract terms and offset programs, which means that it would take more time to wrap up the bargaining and select a successful bidder.

"The government just finished the third-round negotiations on terms of conditions with the three bidders last week, and plans to enter the fourth round of negotiations starting from Nov. 12," a senior DAPA official said, on the condition of anonymity citing the ongoing process.

"The fourth negotiation is expected to take place for about two weeks," he said.

   Considering past negotiations took nearly six months to set prices in the last fighter jet project, experts say the current government doesn't have enough time before President Lee Myung-bak leaves office in February.

   "Even if the remaining processes are handled as fast as possible, picking a model will be possible only after the end of January," a defense firm official said, asking for anonymity due to the ongoing negotiations.

   Experts say it will be hard to speed up the procedure to pick a bidder in the coming months as the incumbent government will be preparing to transition to the next government.

   Lockheed Martin's F-35, which is under development for the U.S. military, was seen as a favorite given the South Korean Air Force's long pursuit of stealth fighter jets. But details of the plane's sale must meet U.S. government regulations under the foreign military sales (FMS) program.

   Unlike direct commercial sales by Boeing and EADS, procurement officials point out that there is less room for negotiating favorable prices due to some contract terms defined by the U.S. State Department, which South Korean officials see as favoring American interests. (Yonhap)

Protracted negotiations delay S. Korea's massive fighter jet project

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