[silence] we can kick off the next panel discussion. And again we have two presenters and two discussions. This panel is focused on opportunities for us are okay Communication Collaboration cooperation in the Aerospace Industry and to my left our first presenter, alana pointman, who is currently at the center for new american security, new york, sorry, got that one wrong, the new america foundation. Apologies, new america foundation. A lot of think tanks in town that all do incredible work and one can confuse them. She is running the new york office for the new america foundation, the former deputy secretary of defense for manufacturing and Industrial Base policy and grapples with all of these issues about the structure of the Aerospace Industry, increasingly Global Nature and how that affects us defense inherently and the opportunities for cooperation between the us and other allies. To her left is doctor wu june janke, director of defense and Aerospace Industry division and Research Fellow at the Korean Institute of trade. Also a member of Defense Division of the National Science and technology council, and Editorial Board member of the journal of Korean Association of Defense Industry studies. He has received a phd in economics from the Seoul National university and graduated from the u. S. Air force institute of technology in 1998 with a masters in logistics management, he works at kia. To his left with our discussants, a little bit out, Major General juan jin o who was a participant at last years conference and make the repeat appearance, thank you for that, director general of the Defense Industry promotion euro, Artillery Brigade commander in the 26 infantry division, also served as chief of the j5, joint combat Capability Development decision with deep background and acquisition as a war fighter, requirement generator and official in the acquisition system and to his left we have doug greenloft who is Vice President and regional executive for asia, Lockheed Martin company, he is responsible for leading Lockheed Martins business to facilitate and unify operational and functional strategies across the whole portfolio within asia and his response abilities span from india to korea but do not include japan and australia if i am reading this correctly, hes laser focused on that area, that includes korea. Previously he was Vice President of International Strategy at Lockheed Martin and has a long career in industry, and aiding in his current job. To his left is a managing director who leads the advanced Pilot Training Program Development at Korea Aerospace industries another of our Conference Participants and sponsoring organizations, he joined in 1988 and started his career as a subcontract manager on the korean trainer experimental which developed into the t 50 program which is now operating around the world. He will be acting as another of our discussions. At this point i would like to turn it over to alana to deliver the first presentation. Thank you for inviting me, really interesting discussion so far, looking forward to hearing from my copanelists. The republic of korea is one of the United Statess most Strategic Partners in asia and those in strategic nature and economic nature of the partnership are very important elements to the relationship. As we all know the early 1950s the defense treaty has tied the nations together in the defense cooperation pact with 30,000 us troops based in are okay and the Us Nuclear Umbrella covering the country. Our two countries economies are joined by a trade agreement with a significant trading relationship, south korea is our seventh largest trading partner and the United States is our secondlargest trading partner. This gives a backdrop to the defense Industrial Base which is an important economic issue as much as it is a strategic and defense one. The us runs over all trade deficit with the republic of korea ranging in the its, the strongest exports, just a few figures, over a 5 year average in 20112015 us Defense Products accounted for 80 of koreas defense imports in the republic of korea is among the top customers for Foreign Military sales from 200816, are okay contract with the us totaled close to 16 billion and commercial acquisitions totaled close to 7 billion. In fiscal year 16 alone the Defense Security cooperation over 4 billion in promotional sale agreements to south korea and the help of this relationship is due to two factors, when is the republic of korea defense needs and Second Technology transfers that support are okay aerospace industries, health and sales abroad. When it comes to the defense relationship the us industry enjoyed unparalleled access to the republic of korea. In recent years firms from europe to the middle east have given us firms quite a bit of competition. This is not true of this relationship but is true over all of us sales. The us industry may still enjoy a reputation for cuttingedge technology and brings with it the benefit of interoperability with us forces nonus competitors tout a few advantages. There are fewer restrictions, and industrial support for the company, and us products served by Foreign Military sales and negotiation hurdles lessened quite a bit. It has been a boost to the relationship. The department of defense for many years, they are not easy to grapple with. Another issue that has come up in recent years, sales of the sad system first protested by china which appeared to retaliate economically against republic of korea. That found its way to a solution, that political dimension turns out to be an important piece of the relationship between our defense industries. I also mentioned Technology Transfers are significant issue that was discussed in the last panel, nor is it only the bilateral relationship but they are okays Aerospace Industry is itself a standing. Two years ago it was triple the size of what was five years before that and the government naturally supports that growth. Defense from 20 20 initiative ended emphasizing development of indigenous capabilities by increasing percentage of funds allocated for Defense Research and development. The republic of korea aims to include competitiveness in its Defense Industry and korean firms compete internationally and Aerospace Industry and the republic of korea naturally seeks to secure sick Technology Transfers as part of the defense sales in the us. At the same time this is an opportunity for acrosstheboard collaboration that benefits both partners. Lockheed martin, one of my friends on the panel can speak to that more but lockheed jointly developed a golden eagle, a trainer and Fighter Aircraft successful on the international market. Southeast asia is a major market in rok defense equipment and could potentially be an opportunity for the us Industrial Base through that partnership. At the outlook i would say under the Current Us Administration there may be something similar. On the one hand donald trump has been very forward about us positions toward north korea and aggressively pushed us allies like rok. On the other hand the administration and congress are pulling back from International Engagements including by proposing an updated statute that can complicate Aerospace Joint ventures between us and foreign companies. Given the wildcard of north korea it is hard to use the usual analytical tools to examine the bilateral aerospace relationship. 2017 has been a year of time old and i dont see any reason that will slow down and that will continue to animate strongly what happens in bilateral defense relationships between our two countries and the Defense Industry. Thank you. Doctor john . Defense Aerospace Division in korea, i am proud to be here at the conference because as i said starting here two years ago i hoped to be getting compartmentalized and helpful and important presentation today, i am going to present my words in korean. The public is entitled in arrow industry between our nations. The status quo related to military airplane and swot analysis and the key is how we can improve cooperation in the air industry between our nations, the introduction, the trump government that was sworn in earlier this year proposed the Weapon System as one of the major policies through an accident of nba 2018, estimated to spend 700 billion next year in the military budget and the offset strategy will compel the United States to pursue stateoftheart drones and longrange bombers with more investment in the arrow industry, airplane related search. With increase in the military budget and because of the increase in the demand for civil allies in the emerging nations including china, it seems the rok will be estimated at 840 billion by 2020. With the new government in seoul in may the Congressional Committee was introduced to rapidly cope with new technology that includes drones and other developments in the arrow industry, in this friendly atmosphere we need to actively seek ways to cooperate with two nations and create and further promote synergies. A quick look at the Global Trends in the arrow industry as i stated earlier there is increasing civilian demand and more budget expenditure in the military and with the advent of the fourth industry of evolution and performancebased statistics actively cooperating or promoting convergence in the product and Service Market and a quick look at the arrow industry can be seen as follows. As of 2016, 5. 1 billion which was 90 higher than five years before, erupting around civil aircraft, and the military production taking up 58 , playing a major role in the growth of its industry. When it comes to the export regarding custom basis, delivery basis, as of 2016, 2. 6 billion so export accounts for 51 and military logistics were explained by kp one advanced trainer recording 0. 9 billion, 137 increase compared to five years before. Because of this booming arrow industry, 14,00,000 people recording a 40 increase from four years before, making a healthy contribution to create new jobs, particularly r d, 6. 2 , three times as large as jobs in the purely Manufacturing Sector creating new jobs a great deal. When we come to the history of military aircraft industry in korea we begin by assembly in the 1970s and 80s and 90s moving off of the Licensing Industry for f16 in 2000s, jointly pursue helicopters and training aircraft which was advanced and from 2000 when exporting finished products and as of 2017 unmanned planes developing and cooperating with our friends in asia that include the United States. Military aircraft production as of 2016 stands at 3 billion compared to 2013, increasing 36. 5 accounting for 21. 3 of the overall industry production. When it comes to export of military aircraft stood at . 7 billion as of 2017 accounting for 36 of the entire military exports and establishing itself as the major export item as you can see from this slide when it comes to finished aircraft starting with katie why exported to indonesia in 2001 and succeeded in selling an accumulated number of 145 aircraft pieces and accumulated 5. 3 billion of aircraft and this was driven by export driven policy, the weakness that includes the power that is still lacking and complemented by cooperating with other nations like the United States. Let me move on to how to create cooperation between korea and the United States. Arrow industry cooperation needs to be researched to find a common area of support joint development for concerted efforts for more close cooperation but mister president visited rok in november for two leaders of the nation agreed to activate ways to encourage development of stateoftheart technology and Weapons Systems to implement this great idea consulted of system between our nations when it comes to military efforts in this region and further for your reference in 2014 the us established us india t ppi with india, deputy secretary and director cooperating channels respectively, Interagency Task force comes under dod and the director of International Cooperation in charge of this effort through this, jet engine technology, transporters, where the two nations, us and india are actively seeking core operation opportunities, in particular reaction cell within the dod and contributing to increasing roa from 6 to 12 months. And we can come up with trade initiative for military cooperation as stated. I also concur. Through the strengthening of this consultant body the part of the strategys key component for f 35 fighter jets, repair center, good candidates for actual cooperation between our nations. From 2006 through 2015, our weapon imports 36 trillion, making korea on top when it comes to weapons purchased. We outrank even india and japan. 22 trillion and 100 companies and 6 companies the longing to ten military companies. Traditional in place between our two nations and deepen cooperation can be further expanded and donald trump visited korea and exercised consolidating military industry between the two nations, next item. And the new government in seoul, july coped with fourth industry, to promote the military industry identified as one of the key projects according to the analysis, and replied the fourth industry should be applied to military industry to make it to the platform and Service Application further strengthened. In june, cincinnati, ohio. And two nations, in the area of military engine for them as well. And fighter jets, actively imported from the United States, 1000 airplanes, military training simulator, various areas where our two nations in cooperation. Thirdly, military acquisition and military industry should be the area where we should strengthen research. A governmentfunded center, csi s in 2015. I look forward to continuously working together with you with regards to key issues so that we can contribute to the development of the service and quality and more than willing, various partners like private Research Institutes to lay the groundwork, and industries between our nations, to strengthen our cooperation, the lifecycle for instance in the 1990s f16 fighter jets was the major item, the trainer being exported across the world, mentioned as one of the next generation candidates for the trainers of the United States, one of the most successful for bilateral cooperation, joint effort that began 20 years ago with regards to tpp turned out to be a divine move, huge contribution to developing rapid growth in areas between our two nations and i would like to salute those personally involved in developing 20 years ago and we can come up with a second, third model that can be a Great Success story. The top notch technological power of the United States can be coupled with cheap costs that korea has and the great productivity we can pursue joint development, and the past 16 years our two nations pursued military acquisition and military Industrial Development based on mutual effort, korea standing as one of the 6 largest trading partners and a foregone conclusion, 1 trillion worth of trade volume discussed as a good success. Through the seminar we are holding today i hope and believe even the next 30 years we can come up with concrete ideas to lay the groundwork of future cooperation between our nations, thank you so much. That discussion of conversation about the Aerospace Industry it is important to get some actual Aerospace Industry voices involved so i will turn next to Doug Greenlaw for his thoughts from a Lockheed Martin perception. Distinguished visitors, friends, thanks for the opportunity to speak on this panel with esteemed experts on this topic. Lockheed martin has a proud history partnering with International Customers to create and grow Aerospace Industrial capability around the world. I loved your comments about the brand power as well. Lockheeds partnership with south korean Defense Industry is a great example of how the us and south korea can come together to develop platforms and capabilities that strengthen our respective defense Industrial Bases, support requirements in the republic of korea in the us and globally and help to further bind our countries together enhancing allied capability. For 30 years Lockheed Martin is honored to partner with government, the republic of korea and korean industry and the most critical defense programs most notably missiledefense systems like aegis helicopters and airplanes. Look no further than the l mk i to see how the two allies can produce stateoftheart military platforms, allow me to tell you how this came about. In the 1980s when the republic of Korea Air Force acquired block 32 aircraft under the peace Bridge Program korean industry built the center fuselages, the korean Fighter Program k fp, they discussed and enabled Korea Aerospace industries to become worldclass manufacturer of combat aircraft. In phase when we produce the first 12 aircraft in fort worth, texas. In phase 2, components for the next 30 aircraft were built in fort worth but sent to korea for assembly, in phase 3 the final 72 were produced under license, the followup on program as well. They wanted to develop aircraft design capability and it started as offset for the kfc program. Initially the k 262 for fullscale development in 1997. Also invested in fullscale development program. Not only has it transformed Pilot Training in korea, providing better pilots and overtime for less money, the light combat version has reached full operational capability. The t 50 has seen continued success as Lockheed Martin and k ai collectively promote the platform to meet customer requirements around the world. Several International Customers including philippines, indonesia, iraq and thailand recognize the important capabilities of the t 50 and faa 50 bring to their respective militaries and decided to procure the platform. K ai and Lockheed Martin are excited to deliver this capability to these customers and others for decades to come. This is an example of what tommy ross describes creating capability in southeast asia. The t 50 partnership is an excellent example how and why us are okay cooperation in the Aerospace Industry can yield significant benefits for both our countries and serve collective interest and support allied capability. We value the opportunity to cooperate with the republic of korea and korean industry to meet the korean, us and global needs for the best Defense Products and thank you for the opportunity to speak today. I would appreciate your thoughts next . It is an honor to be sitting here with a distinguished panelists and be in attendance to this Great Development on p 50, and continuing it is great, we set a great example. Because this is a Great Success story. Great pride and success we had, Going Forward we hope the same, pretending to allies in this regard. At least a few minutes to give opening thoughts. I am working as director general for the bureau after the discussion i thought it would ask questions rather than make a comment but now that i asked for comments i will do so. A lot of what i wanted to say today has been spoken of by very distinguished Panel Members and keynote speeches and other sessions. What i wanted to speak about has been spoken of today and i agree with the keynote speeches and i will make a few remarks. As to koreas Aerospace Industry, doctor chen was very eloquent and precise and specific in the Development History of our industry from a nation, a participant in manufacturing, assembling and a participant in innovative processes. These would not have been possible without the collaboration and cooperation with our strongest ally, the us. Having said that, our history together, i believe we can move Forward Together as well, as to our policy in korea, the Defense Industry is about openness and competition. We went to have competitiveness, the Global Competitiveness does not have to come from korea alone, but also from outside, and by having joint forces or proceedings in the global Defense Industry i believe we could have more of an effect on the global industry. When it comes to the Defense Industry . There has to be an equal system available for the corporations in korea and more actively involved themselves in Defense Industry activities, we want an equal system, and research and development for our military. And and and and looking for ways, and and the Defense Industry, by pursuing different approaches for a common goal we would like to see a more effective enhanced industry, and as many participants have spoken of today there are some positions with collaboration between korea and the us and of course we had a long history together but our relationship could be better. We could never win win system where we benefit from our continued alliance and relationship and there are areas where we have an advantage in korea and by finding areas for the effectiveness of the us industry, advanced Pilot Training aircraft and other training areas, it can be in addition to the us effectiveness and also there are offset programs, it comes from the us but find a way to more effective utilize the offset program so it is not on Second Thought could be something playing another pool with the us and also how about joint marketing and manufacturing. Maybe we could go Forward Together to other markets. T 50 is a great example, when spoken of, k ai and Lockheed Martin giving off the aircraft currently being exported to many countries and discussions and negotiations on their way already so this is a win win situation for Lockheed Martin and beyond for our two allies. As you know already a pt business jointly participating in if we are to be selected as a pt contractor for the us from 2018, this would be a great opportunity to further enhance our relationship. There are more opportunities we could explore and there should be a subset of cooperative body for two nations, we have spoken of it already many times and as to koreas development, there are certain concerns about technology being leaked from us to korea to a third nation, this is something to further discuss with further intellectual properties, technologies, grateful for this opportunity to be at this conference. Certain plates we should discuss together, we have a lot of food for thought for todays discussions. A couple examples of success already out there, the faa 50 aircraft addressing comments, the us and are okay, and southeast asia, the tx program getting there as well. The panels thoughts, at the beginning of the day donald trump was in korea, discussion about many potential new arms deals pending or on the pipeline in the next few years but during the term of this administration. I would be interested in the panels thoughts as we look at potential new deal that could be large. How would you and your ideal world, the industry to industry, the it is obvious from the presentation that the korean industry has dramatically grown its capabilities and its potential to be a partner in efforts, also clear there are a few areas there is growth to be had. Anyone who chooses to combat an opportunity to talk about what they would like to see happen as these deals are negotiated. Would you like to start . Thank you for your great comment. It was the seventh when donald trump visited korea, having discussion with president moon, consolidating military industry cooperation between our two nations, purchase of the stateoftheart Weapon System is important but korea can become a Development Partner which is just as important. What is most urgent in korea as you know very well is a north Korean Nuclear problem by acquiring a military system, developing its own Weapon System, japan can play a certain role. During the crisis with china, rapidly purchased by japan, korea may follow suit when it comes to urgent issues. The stateoftheart Weapon System of the United States is something korea will be willing and actively purchasing. Nevertheless, korea is in a place where it needs to develop its own capability, other indigenous Weapon Systems and even in those areas, technological support and cooperation from the United States is much needed. In that regard, active in those areas as stated with reference to the us india ttt i, the core was indias military industry can be strengthened, likewise if the same consideration can be made to sustain a secure environment over the Korean Peninsula by the United States providing help to strengthen the rok, that needs to be considered and also the export area according to a recent crs Research Outputs the us is the largest exporter to the middle east which accounts for a 40 , by contrast career has some strength in the asian market because for less than 20 in that area, in that market the two nations not only that but in other areas, if we could cooperate in Technology Development assistance it could create synergies and in this situation joint development, production and export can be ascertained like two years ago as we discussed when we held a seminar, the track should be actively explored. That concludes my remarks. I want to expand on the question a little bit and expand beyond the military to military relationship. In the us the us defensive partners, the commercial industry, expanding capabilities and in fact more and more of the newest important developments being researched and financed and deployed in commercial industry and an important component of the defense structure and korea certainly has a very rich indigenous capability beyond the Defense Sector so these developments could really round out the relationship even in the military to military technology relationship. It is easy for commercial industries to work, they can be supported by a strong economic relationship and when you think about the major defense systems, the major threats we are facing whether it is cybersecurity where you definitely see a threat in the region or the ability to use Artificial Intelligence in all sorts of Weapon Systems and beyond, and capability like block chain that may be able for example be used in china to promote better, cheaper logistics in the commercial industries. All of these areas, korean and us industry can Work Together, they could Work Together through programs to round out the capabilities beyond what is happening in the Defense Sector and i commend what the general set about joint marketing which is less politically costly joint manufacturing though i agree joint manufacturing is important but the ability to Work Together beyond because we are in such different parts of the world and there are cultural and old relationships and geographic ties that can play an Important Role and will allow Us Government and industry to see more readily the great benefit that comes with korean relationship and what we have seen traditionally, defense and defense capability. Thanks, a good question, we are all in on cooperation to promote partnerships from Fighter Airplanes to training airplanes to helicopters to shipbuilding and working some areas where we are leveraging commercial shipbuilding capabilities because they are the best in the world. If we allow industry to work with as much likability as possible we will creatively find the best solutions. You mentioned improving the offset program. As a member of industry we welcome the opportunity to discuss this further. Models like australia that moved away from offsets per se for industrial collaboration. And benefits for both countries, we would encourage that. I am struck that doctor john mentioned ttt i with india a couple times. Your span happens to cover india, korea and a few comments on that, a possibility you could see. It has been a success and the tone that it sets is greatly enabling the systems to Work Together. The indian bureaucracy in the us if i could use that word are fairly different, in korea they are much more similar so i welcome the program in korea and it could be more effective than we have been in india though i would characterize india as successful. See if there are questions from the audience. If anyone would raise their hand and offer a question, briefly state your affiliation. Thanks to the panel. It seems to me an Aerospace Industry, what is the platform, the other is a subcomponent in technology with a broader supply chain, im intrigued by the rise of koreas Aerospace Industry because on the commercial side is at about subcomponents and technologies whereas the military side is heavily platform centric so there are other areas of the quadrant that present themselves, commercial platforms or associated risk sharing partnerships or segmented military components and technologies in the supply chain. Specific opportunities in those quadrants. I dont know if you have thoughts about that supply chain and the work that could be done. As you stated in the commercial area, subcomponent manufacturing is the area we involve and expand by risksharing, something we are searching and as you stated when it comes to the supply chain in the domain of military industry, the development and comparative edge is the area we pursue through system integration, that capability is a must, that is the approach we bring into the developed supply chain, increasing the understanding of the space particularly in involvement in the ft industry which was proven in contrast to that to enhance our competitiveness we need to develop new areas and acquires them and along the way supply chain, how can it be pursued for cooperation, an area we had growing understanding. It could be handy for opportunity and outreach down the road. Related to that i would like to add one more comment. Just as you stated the military aircraft has been developed centering on a platform when it comes to core components, doesnt have enough technology to pursue indigenously. We are aware of the shortage so small and Mediumsized Companies need to be promoted, catapult into global Ranking Companies and exert greater effort and in charge of that effort, the direction we are thinking into and toward that end small and mediumsized military Industry Partners need to be promoted for their capability by developing programs, korea is preparing the fleet offset which is what we call previously was only one union in the industry so the scale or other dimensions were quite limited in the past but if we learn from the case of israel or turkey, small and mediumsized, active partners in the global value chain, and an area we are very proactive by identifying mediumsized military companies in the korean market place and supporting them and if this effort can be positively appreciated on the us side to acknowledge mutually beneficial areas to seize the korean market that would be appreciated, thank you so much. Thank you for that question. That will finish off this panel discussion. I want to take a moment to thank our partners including k ai. The session will conclude the public part of this conference. Those of you continue with private events that follow downstairs on the concourse level but for now please join me in thanking this panel for an excellent discussion. [applause] alabama holding a special election to fill the seat of attorney general jeff sessions, doug jones running against republican roy moore in a close chase, and the results come in with candidate victory and discussion on cspan2. Watch cspan3 at 10 30 eastern for live coverage of the vote on Net Neutrality with Net Neutrality rules passed in the Obama Administration to reduce registration of the internet live thursday at 10 30 eastern on cspan3. The Democratic National Committee Reform commission agreed to a number
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