$4.5 billion jet project could be put on the shelf

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$4.5 billion jet project could be put on the shelf

A large national project to develop Korean fighter jets may be scrapped due to difficulties in attracting overseas partners to join in.

The project, which is called KFX Business, is supposed to build 120 fighter jets with Korea’s own technology by 2021. The total budget was estimated at 5.07 trillion won ($4.53 billion). The new jets were supposed to be superior to the KF-16, the main fighter aircraft for Korea, which uses technology from General Dynamics in the United States.

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However, the national budget plan announced Tuesday had no budget for the project next year. Instead, the government allocated about 4.5 billion won to study whether the project is feasible. Even if the study finds the plan is feasible, it will be shelved until 2014. So far, the government has spent 5.51 billion won on the project, largely to study a development plan. Under the old plan, the government should spend at least 2.53 trillion won in total and attract the balance of the total budget from foreign investors.

The project is wobbling after the Turkish government backtracked on an earlier plan to pay part of the expenses, according to the Ministry of National Defense. Turkey had a problem with some of the conditions of the investment.

An official of the Defense Acquisition Program Administration told the JoongAng Ilbo that the project is still possible.

“Although the Turkish government backpedaled on their participation, we still have Indonesia, which promised to invest 20 percent,” the official said. “So if the Korean government spends the rest of the money, 80 percent, the project will be able to go on.”

However, Baek Gun-gi, an opposition Democratic United Party lawmaker who is a member of the National Assembly’s National Defense Committee, still raises concerns over the feasibility of the project. He said the Korean government will have to spend 1 trillion won more due to the withdrawal of Turkey.

“The project could be suspended,” he said. “The government failed to plan the project meticulously.”

By Jeong Yong-soo, Ku Dong-hoe [heejin@joongang.co.kr]

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