Signed Main Contract for Export of 48 FA-50 Fighter Jets Worth $3 Billion to Poland

[Asia Economy Reporter Jang Hyowon] Korea Aerospace Industries (KAI) has signed a $3 billion fighter jet export contract with Poland.

On the 16th (local time), according to the Ministry of National Defense and the Defense Acquisition Program Administration, KAI signed an export implementation contract for 48 FA-50 fighter jets with the Polish Armaments Agency in Mi?sk Mazowiecki, Poland.

This contract pertains to the implementation of the FA-50 export under the master contract (basic contract) signed on July 27 between three domestic defense companies and the Polish Armaments Agency. The contract size is approximately $3 billion.

The signing ceremony was attended by Andrzej Duda, President of Poland; Mariusz Błaszczak, Deputy Prime Minister and Minister of National Defense of Poland; Kang Goo-young, President of KAI; and Eom Dong-hwan, Administrator of the Defense Acquisition Program Administration.

After delivery, the Air Force plans to strengthen cooperation between the two countries' air forces by transferring FA-50 operational know-how to the Polish Air Force and providing education and training programs.

KAI plans to promote the establishment of an MRO (Maintenance, Repair, and Overhaul) center capable of comprehensive FA-50 maintenance and an international flight training school in Poland in the mid to long term.

Producing a fighter jet requires 200,000 to 300,000 parts per unit, most of which are assembled manually, so significant economic ripple effects are expected from this contract. Exporting one fighter jet is known to have an effect comparable to exporting 1,000 domestically produced mid-sized cars.

KAI estimated that this export will generate an industrial ripple effect worth about 10 trillion won. Employment creation in industries directly and indirectly related to fighter jet production is also expected to be substantial.

Meanwhile, KAI has signed implementation contracts for all quantities specified in the master contract for the FA-50, and additional contract negotiations are underway for the remaining quantities beyond the first contract for the K2 and K-9.