S.Korea steps up probe on alleged submarine tech leaks to Taiwan

South Korea stepped up an investigation into alleged technology leaks of a submarine developed by Daewoo Shipbuilding & Marine Engineering Co. to Taiwan, which was suspected of having used it for the island’s first homegrown military sub, according to sources in Seoul.

The police charged two people, including a former Daewoo official, for the alleged technology leaks, according to the Korean National Police Agency on Wednesday. The two allegedly secured an entire submarine blueprint set when they worked for the South Korean shipbuilder, currently Hanwha Ocean Co., and left Daewoo for a local submarine development consulting firm, identified only by "S." The two suspects were known to have transferred the blueprint set to Taiwan.

The 2,000-page blueprint outlined the technology of the DSME1400 model, which made South Korea the world’s fifth submarine exporter. Daewoo exported three units of the model to Indonesia for 1.2 trillion won ($916 million) in 2019. The submarine can sail 10,000 nautical miles (18,520 kilometers), carrying 40 crew members without stopping at any ports.

The authority also booked the firm, which inked a consulting deal with Taiwan, for not preventing the leaks.

The firm, founded by ex-Daewoo officials and former South Korean Navy officers, was on trial last year for taking out various parts used for Taiwan’s first domestically developed diesel submarine – the Hai Kun – unveiled in September 2023. A lower court sentenced an executive of the firm to one and half years in prison suspended for two years while fining the S company 1 billion won for violating the Foreign Trade Act in August of last year.

“The investigation authorities failed to reveal the firm’s technology leaks at that time,” said an official in Seoul. “Additional probes revealed the alleged charges including the blueprint transfers.”

South Korea currently does not allow exports of submarine technology to Taiwan as such a transfer is expected to worsen relations with China.

HAI KUN

The alleged technology leaks caused a stir in South Korea’s relationship with Taiwan, which has been working on the Indigenous Defense Submarine (IDS) program with an estimated spending of up to $16 billion since 2016, according to industry sources in Seoul. Taiwan showcased the Hai Kun, which is estimated to be in the 2,500-2,800-ton class and 70 meters in length, last year.

It took seven years to design and manufacture the vessel, which was known to have used much South Korean submarine technology, according to industry sources in Seoul.

“Korean experts are transferring technology for other submarines such as the Hai Kun No. 2 in person in Taiwan,” one of the sources said.

Daewoo’s submarine blueprint was circulated at Taiwanese shipbuilder CSBC Corp., which manufactured the Hai Kun. Many South Korean submarine experts have been working there for years, another industry source in Seoul said.

“CSBC hired Korean experts recommended by the submarine consulting firm and the Taiwanese government for each production process,” said the source, who is deeply involved in the island’s submarine development. “The government also offers good salaries to Korean experts to entice them to work in Taiwan for at least six months or several years.”

TIP-OFF FROM TAIWANESE LAWMAKER

The alleged leak was reported by a pro-Beijing Taiwanese lawmaker, who informed the Taipei Mission in South Korea that Daewoo’s submarine blueprint was circulated among key stakeholders including CSBC officials.

China has been actively containing Taiwan’s submarine development project due to geopolitical conflicts and territorial disputes in the South China Sea.

South Korean police have been investigating the case since last year when the report was passed to the country’s bodies such as the Defense Acquisition Program Administration and the National Intelligence Service.

The police are facing difficulty in investigating the case as many of the consulting firm’s staff are currently in Taiwan, given the lack of cooperation of the local authorities. The firm’s head, a former South Korean Navy officer, is also staying on the island, refusing to cooperate with the country’s investigation authorities.

The firm’s employees have denied the allegation, claiming that did not hand over Daewoo’s submarine blueprint to Taiwan.

“When Daewoo exported the submarines to Indonesia, the blueprint was also transferred,” said the firm. “The blueprint may have been illegally handed over to Taiwan in the process.”

Write to Cheol-Oh Cho and Woo-Sub Kim at cheol@hankyung.com
 

Jongwoo Cheon edited this article.