Korean Defense Exports to Poland: Seoul Secures Just 11% of EU Joint Fund

Analysis suggests that the actual amount Korean companies can secure from large defense export contracts with Poland may be less than initially expected. Out of the €75 trillion allocated to the European Union's (EU) joint defense fund (SAFE), Korean firms can only access 11%, as EU 'preferential procurement of European products' policies limit the sourcing ratio of Korean-made components to 35%. According to an analysis by the Polish parliament, 89% of the approximately €75 trillion in EU SAFE funds is prioritized for Poland's domestic industry, with only the remaining 11% available for the purchase of equipment from countries not among EU member states, such as Korea or the United States. The South Korean government submitted a letter of intent to participate in SAFE to the EU in September 2023 and has been in discussions for a bilateral agreement to ease these restrictive conditions. The EU's 'Buy European' regulations act as a barrier for Korean defense companies. Under SAFE funding, weapons purchased must meet at least 65% of their component value from EU, Ukraine, or Norwegian sources, with the proportion of Korean components not exceeding 35%.

Hanwha Aerospace has broken ground for a European factory in Romania, establishing assembly and maintenance lines for the K-9 self-propelled howitzer and K-10 ammunition resupply vehicle, aiming for an 80% localization rate. Hyundai Rotem is producing 81 units of the K2PL variant out of 180 tanks under the second phase of its Polish contract at the local WBM-WPB factory. The EU Council adopted SAFE regulations in May 2025, creating a fund of €150 billion (approximately 258 trillion won) in low-interest, long-term loans available to member states through EU bonds. The European Commission approved defense investment plans for 18 countries, including Poland (€43.7 billion) and Romania (€16.7 billion), between February and April 2024. Approximately 40% of the €150 billion SAFE funds were allocated to Poland and Romania. Canada became the first non-EU country to officially join SAFE by signing a bilateral agreement with the EU in December 2023.