Defense Companies' Concerns Over Proceeding with Defense Exhibition

[Asia Economy Reporter Yang Nak-gyu] Despite the spread of the novel coronavirus infection (COVID-19), this year's 'Defense Expo Korea (DX KOREA 2020)' is being held, causing frustration within the defense industry. Defense companies are worried that the event will become a half-hearted exhibition with virtually no participation from overseas buyers due to the impact of COVID-19. Some companies are canceling their participation and requesting refunds of their entry fees, but the organizers are refusing these requests.

According to industry sources on the 4th, the fourth edition of DX KOREA will be held from September 16 to 19 at KINTEX in Ilsan. The event is hosted by the Army Association and organized by DXK Co., Ltd. Defense companies paid 50% of their participation fees to DXK by the end of last month to take part in this year's event. According to DXK, 120 defense companies applied to participate this year, with participation fees reportedly ranging from 100 million to 200 million KRW per company. After the exhibition, DXK donates a portion of the participation fees collected from defense companies to the Army Association, sharing the profits.

The problem is that defense companies that applied to participate cannot get their fees refunded even if they cancel due to COVID-19. These companies argue that if overseas buyers' visits are low due to the pandemic, there is no reason to participate in the exhibition. The organizer states that they will follow government policies, but the industry believes that since the organizer did not consult with government bodies such as the Korea Disease Control and Prevention Agency when deciding to hold the event, they have no intention of refunding the fees. The Seoul Defense Dialogue (SDD), which was scheduled to be held around the same time as DX KOREA, has been changed to a virtual meeting. Additionally, the Gyeryong World Military Culture Festival and defense exhibitions in Australia have all been canceled.

A defense industry official said, "Domestic and international defense exhibitions require visits from foreign customers," adding, "It should not end up as a celebration only for companies that organize exhibitions for defense companies struggling with exports."

Meanwhile, controversy has arisen over an exhibition that created fake promotional materials claiming government agency sponsorship. The Korea Defense MICE Institute is holding the 'Korea Defense Industry Development Conference and Exhibition' from the 2nd to the 4th at the Sejong Convention Center. While the institute promoted on its website that the Defense Acquisition Program Administration, Agency for Defense Development, and Defense Research Institute are sponsoring the event, the Defense Acquisition Program Administration responded that this is "untrue."