Defense Acquisition Program Administration builds on its 20th anniversary and a 20 trillion won budget to break into the world’s top four defense industry powers

[Financial News] The Defense Acquisition Program Administration (DAPA) unveiled a sweeping defense administration roadmap centered on securing technological sovereignty for self-reliant defense and diversifying global markets in a work briefing for the 2026 parliamentary audit held by the National Assembly Defense Committee on the 13th. As a key bulwark of national security driving South Korea’s self-reliant defense and the growth of its advanced K-Defense Industry, and a driver of future growth, DAPA is leading the way in the domestic production of world-class weapons systems and technological innovation. DAPA said that, marking its 20th anniversary this year, it would enter the era of a 20 trillion won budget and firmly lay the groundwork for South Korea to become one of the world’s four leading defense industry powers through a major transformation of the defense industry. In opening remarks before the briefing, DAPA Commissioner Lee Yong-cheol said, “As we mark DAPA’s 20th anniversary this year, we will further strengthen our role and responsibility in defense acquisition,” adding, “We will build a firm foundation for South Korea to rise among the world’s four leading powers through a major transformation of the defense industry.”
■Entering the “20 trillion won budget era” with focused investment in advanced R&D and mass production of weaponsAccording to general information DAPA submitted to the National Assembly, the agency currently consists of four bureaus, three departments, three affiliated agencies, and two government-funded institutions—the Agency for Defense Development (ADD) and the Defense Agency for Technology and Quality—and is led by a total of 1,622 highly skilled personnel.
This year’s defense capability improvement budget totals 19.9653 trillion won, effectively ushering in the era of a 20 trillion won budget. Of that amount, 5.8396 trillion won was allocated to defense R&D, including weapons systems and defense technology development, while the largest share, 13.3471 trillion won, is being spent on weapons system procurement and mass production to accelerate the deployment of capabilities to frontline units.
A notable feature is the sharp growth in next year’s budget. DAPA said the 2027 government budget proposal was set at 22.7224 trillion won, up 13.8% (2.7571 trillion won) from this year. The budget for weapons system procurement and mass production surged 19.4% to 15.9323 trillion won, laying the foundation for large-scale production of advanced capabilities. Funding for defense industry promotion also rose 12.4% to 600.2 billion won, strengthening the financial basis for building a sustainable defense industry ecosystem.■Securing “overwhelming capabilities” by formalizing the nuclear-powered submarine program and fielding the three-axis system on scheduleDAPA has staked everything on building key independent military capabilities to counter North Korea’s nuclear and WMD (weapons of mass destruction) threats on all fronts and secure the ability to assume wartime operational control at an early date. The most notable item in the report was the formal establishment and progress of the Nuclear-Powered Submarine Project Team. DAPA has formalized the development of a nuclear propulsion system by mobilizing its submarine development organization and specialized expertise, and plans to take charge of drawing up the submarine construction project plan to transform the maritime security paradigm.
At the same time, to field Korea’s three-axis system on schedule, DAPA will carry out the Long-Range Artillery Interception System, Gwanggaeto-III Batch-II, and the second F-35A project without delays and in line with their timelines. In the air and space domains, following the successful deployment of the first mass-produced KF-21, it plans to launch full-scale development of military reconnaissance and communications satellites, including a microsatellite system and the 425-II project, to establish an independent space surveillance network.
Plans to build manned-unmanned teaming systems that could become game changers on future battlefields have also taken shape. Alongside the deployment of unmanned systems such as combat unmanned surface vessels and small attack drones, DAPA is accelerating the acquisition of advanced defenses against emerging threats, including laser air defense weapons and an integrated counter-drone system for frontline areas. In defense R&D, the plan is to secure a decisive lead in key technological sovereignty through the development of AI semiconductors for guided missile control, advanced aircraft engines for next-generation fighter jets, and low-observable unmanned aircraft for formation flying.■Reforming rigid acquisition procedures; all-out effort to enact the Defense Advanced Capabilities Projects ActTo rapidly incorporate fast-changing advanced technologies into weapons systems, DAPA has announced a shift to a swift, open system that transforms the existing paradigm for determining military requirements and procurement. Moving away from the traditional approach in which the military unilaterally specified quantitative performance and technical requirements, it will introduce a “private-sector advanced technology competition” through which companies can directly propose target performance and project schedules.
To dramatically shorten development timelines, DAPA will abandon the practice of developing systems for a long period and deploying them all at once. Instead, it will establish an “iterative development” process in which an initial version is first deployed in the field, then tested and continuously upgraded. It will also immediately introduce “field user evaluations” focused on military satisfaction to break down barriers to military adoption, long notorious for their complex assessment procedures.
To establish this system in law, DAPA plans to make every effort to secure passage by the National Assembly in the second half of the year of the Defense Advanced Capabilities Projects Act, introduced in August this year. It also plans to sharply shorten the “rapid demonstration project”—in which the military first tests privately developed products before formal requirements are set—from two years to one, and quickly supply the military with advanced weapons such as drones and satellites that have recently come to the fore on battlefields.■Building the foundations for a mutually supportive ecosystem for large and small businesses and diversifying K-Defense Industry’s global reachDAPA aims to go beyond being a simple weapons procurement agency and build a robust defense industry network in which large and small businesses and local communities grow together. It is pursuing revisions to the Defense Industry Development Act to institutionalize cooperation between large and small businesses, and will establish a defense-industry-specific cooperation evaluation index this year to offer exceptional incentives to high-performing companies starting next year. In particular, it plans to launch a “win-win cooperation for parts localization” initiative in which the government, prime contractors, and small and medium-sized enterprises develop weapons components as one team. It is also considering expanding reductions in technology royalties and creating a dedicated track for small and medium-sized enterprises so that export profits flow back to them.
To stabilize supply chains, DAPA will establish a weapons systems supply chain database and an early-warning system to identify signs of disruption in advance. It also plans to add regional “defense industry innovation clusters” in key locations—including North Jeolla Province (advanced materials), Incheon (AI aviation), South Chungcheong Province (AI robotics), and Busan, Ulsan Metropolitan City, South Gyeongsang Province, and South Jeolla Province (naval vessel MRO)—to promote shared growth with local economies.
Global export markets are also set to advance to the next level. Having strengthened the defense industry’s self-reliance in semiconductors under the Defense Semiconductor Act enacted in the first half of this year, DAPA has recently made inroads into new European markets, including Croatia. Going forward, it plans to pursue tailored export packages across all regions, including projects to build U.S. naval vessels abroad and land systems projects in North America; medium- and long-term strategies involving localization and technology transfer in the Middle East; participation in overseas defense supply chains and cooperation with NATO in Europe; and bids for contracts to supply tanks and submarines to Peru, backed by financial support, in Asia and Latin America.■A bulwark of security that meets public expectations: “We will move forward on the basis of the National Assembly’s considered views”DAPA said it would complete the “Defense Industry AI Transformation Roadmap” as planned in the second half of the year, successfully transform the military into a technologically advanced force, and take the lead in safeguarding national security and advancing the national interest.
As it concluded its work briefing for the parliamentary audit, DAPA made clear its commitment to use the National Assembly’s pointed criticism and recommendations as a foundation for administrative reform. Commissioner Lee promised, “This audit is a valuable opportunity to take an in-depth look at the work DAPA has carried out, with the benefit of the committee members’ considered views, and to move in a better direction.” He added, “Based on the issues discussed today, we will carefully review all aspects of defense acquisition, successfully carry out our projects, and further improve our policies and systems.” The public’s support and expectations are focused on DAPA’s ongoing efforts to achieve both robust security and a strong economy.


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