Australia and South Korea sign $717 million defense deal

Australia’s Prime Minister Scott Morrison has signed a 1 billion Australian dollar ($716.5 million) defense deal with South Korean President Moon Jae-in. The contract was signed during a four-day visit by President Moon to Canberra.

Under the contract terms, South Korean defense company Hanwha Corp will build 30 self-propelled howitzers and 15 armored ammunition resupply vehicles for the Australian military.

It is the largest defense contract struck between Australia and an Asian country and comes at a time when the relationship between China and Australia is tense. The deal positions South Korea’s Hanwha as a frontrunner for Australia’s planned 30 billion Australian dollars contract to build infantry combat vehicles for the Australian army.

President Moon met with Australian Prime Minister Scott Morrison during his visit. The leaders agreed to upgrade the formal ties between the two countries to a comprehensive strategic partnership. The leaders also announced they would work together to develop clean energy technologies and facilitate the supply of critical minerals abundant within Australia.

Australia recently had announced a deal to build nuclear-powered in partnership with the U.S. and the UK, a move that China strongly condemned.

Prime Minister Morrison said the defense contract would create about 300 jobs within Australia; a division of Hanwha already operates in Australia.