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Policy Group Says U.S. Too Strict on Arms Exports

December 18, 1985

WASHINGTON (AP) _ U.S. controls on South Korean arms exports are threatening the existence of the munitions industry that the United States helped the Asian country launch a generation ago, a conservative policy study group says.

The restrictions should be eased in order to save the Korean arms industry as an asset for the United States, the Heritage Foundation said in a report by Hwang Dong-Joon, a Korean research fellow at its Asian Studies Center.

Korean defense production would be vital to U.S. and Western security in the event of war, the study released this week said. It also provides a needed market for U.S. spare parts and a source for military subcontracting and repair no longer available in the United States, the study said.

South Korea has largely filled its conventional arms needs at home but when the industry turned to exports it ran into U.S. restrictions on the sale of military hardware containing American designs or components.

In 1984, the South Korean defense industry was operating at only 42 percent capacity and nine companies had gone bankrupt with others on the verge of collapse, the report said.

Washington cleared only $1.7 million worth of $55.4 million worth of arms Seoul wanted to sell abroad in 1981-82 because of pressure from U.S. defense contractors opposing competition, the study said.

The study said this was short-sighted because South Korea imports from the United States 43 percent of the parts needed for its weapons industry, netting the United States more than $1 billion a year.

″Secondly, the U.S. and the Republic of (South) Korea both would benefit enormously from increased coproduction of conventional weapons,″ it continued. ″There are serious deficiencies in the U.S. at the subcontractors ′ level. South Korean industries could fill this void.″

The study said South Korean military exports in 1983, mainly to other Asian countries, the Middle East and South America, totaled $355 million. They included small arms, ammunition, patrol craft and various vehicles.

″ROK arms exports face heavy competition from Israel, Brazil, China, India, North Korea, Yugoslavia and Bulgaria, but the major obstacle is the U.S.,″ the study said. ″As a result ... South Korea’s defense industrial base may have to be dismantled unless it finds more production opportunities.″

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