[fn Plaza] Survival Strategy for Nuclear Power and Defense Exporters

"South Korea is not allowed to enrich or reprocess nuclear fuel. What would happen if fuel supplies were cut off after using a Korean-made NPP? We also have a nuclear reprocessing company, so we can guarantee a stable fuel supply."
In 2008, when the race to win the UAE NPP project was at its peak, France appealed to the country by striking at South Korea's Achilles' heel. The KEPCO-led 'Korea consortium' had strong construction capabilities and price competitiveness, but the market was leaning toward France because South Korea could not enrich or reprocess nuclear fuel.
Then South Korea's bold proposal for a military and security partnership changed the UAE's choice. The UAE wanted the builder of its NPPs to help shoulder part of its security burden, and South Korea seized that opportunity. It promised to deploy the Akh Unit and made a political commitment to stand with the UAE as a 'brother nation.' The UAE faces off against Iran, a country of 90 million people, across a single strait. With 9 million foreigners among its 10 million residents and only 1 million citizens, easing security anxiety was an urgent task. It saw the presence of foreign troops on its soil as a deterrent.
Backed by South Korea's decisive move to send troops and address an urgent issue, the Korea consortium won the main contract in December 2009 to build four Barakah Nuclear Power Plants. That is how South Korea's first $18.6 billion export of a 'K NPP' came about. After that, the UAE began favoring Korean companies in various bidding competitions. If a certain country were to invade the UAE, South Korean troops would also be drawn in, creating what was effectively an alliance.
On that foundation of trust, Korean companies have carried out more than 100 projects in the UAE, and their annual order intake has approached $10 billion, or $9.37 billion in 2025.
Whenever a new South Korean government took office, the UAE would invite the President's Chief of Staff. In the process, it would again secure a commitment to extend the troop deployment and strengthen ties by offering additional fuel as a gift. Chief of Staffs Lim Jong-seok and Kang Won-sik also made such visits.
Mega deals like NPP contracts are on a completely different level from buying and selling goods based on price and value. They involve a complex equation built on trust between states, strategic decisions and promises, prospects for future cooperation, and geopolitical considerations. In cases like the UAE, where security anxiety runs high, the deal becomes even more of a package exchange of trust and security. It requires delicate diplomatic and geopolitical judgment, along with political resolve at the national level.
The defense industry is even more complicated. A recent competition for the Canadian Patrol Submarine Project (CPSP), which was ultimately awarded to Germany earlier this month, exposed that reality.
The rapid growth in customers for the K-defense industry stems from rising security concerns caused by the expansionist behavior of some major powers. Defense exports also come with risks and dilemmas. No one buys and sells NPP and defense goods based only on price and quality.
Defense exports can succeed and endure only when exporters keep their promises to customer countries and inspire trust in maintenance, repairs, and parts supply, even under pressure from powerful third countries telling them not to sell certain weapons to certain countries.
There are neighboring major powers that watch Korean exports of the K2 tank, K9 Thunder, and K239 Chunmoo to K-defense industry customers with discomfort. The calculations become more complex because these are multilateral actions that must take into account not just bilateral ties, but also other parties.
At times, some stakeholders view defense cooperation as an indirect military act. That was the context behind the Russian Foreign Ministry's move on the 16th to summon Lee Seok-bae, South Korea's ambassador to Russia, and pressure him by saying it had "serious concerns that South Korea is leaning even further toward NATO." It was also meant to check President Lee Jae-myung's proposal, announced at the July 7-8 NATO summit in Turkey, to expand South Korea-NATO defense cooperation.
A country that exports defense products is no longer the same country that once sold refrigerators and washing machines. It now faces a completely different diplomatic landscape and new challenges. It must avoid, endure, and break through the traps of friendship and hostility, alliance and entanglement. South Korea, with its enlarged scale, must also change its mindset and attitude to survive.
Has it developed new habits and strategies to match that change? To what extent is preventive diplomacy being carried out by checking the positions of neighboring countries and stakeholders in advance, persuading them, and preparing responses?
Russia's recent backlash and the failure in the CPSP competition demand fresh thinking and a thorough reassessment. It is time to build a new national survival strategy better suited to the changed international environment and landscape, and to redouble efforts to create a more favorable new environment.
[email protected] Reporter