Carney Tours Korean Shipyard Ahead of Submarine Decision

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(Bloomberg) — Canadian Prime Minister Mark Carney got a close-up view Thursday of the submarines built by the South Korean firm bidding for a government contract worth tens of billions of dollars.

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Canada’s military plans to purchase up to 12 conventionally powered subs, and Carney has narrowed the competition to one bid led by South Korea’s Hanwha Ocean Co., and another by Germany’s Thyssenkrupp Marine Systems. A decision is expected within a year.

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“It’s a beautiful submarine,” said Vice-Admiral Angus Topshee, the commander of Canada’s navy, speaking after he toured one of Hanwha’s newly-built vessels alongside Carney and other officials. But he added that the Korean and German subs are both “excellent” and would meet the military’s needs.

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Canada’s current fleet of submarines is nearly obsolete, and a major objective of the new purchase is to patrol the country’s vast Arctic coastline, officials have said.

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South Korean Prime Minister Kim Min-seok was at Hanwha’s shipyard to greet Carney, who is in the country to attend Asia-Pacific Economic Cooperation summit. Carney previously toured the German shipyard of TKMS in August. 

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The sub purchase comes as Carney dramatically hikes Canada’s military spending, and will be one of the most expensive military procurements in Canadian history. Hanwha has said its bid would range from C$20 billion ($14.3 billion) to C$24 billion, not including the maintenance and infrastructure needed to support the subs for decades.

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If Canada signs a contract next year, the first sub could be delivered by 2032, said Steve Jeong, a senior Hanwha executive who spoke to reporters after the tour. The firm is partnering on the bid with HD Hyundai Heavy Industries Co. which is also a shipbuilder.

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Canadian officials have said a major factor in their decision will be the economic benefits to Canada, in part to support sectors such as the steel industry that have been battered by tariffs imposed by US President Donald Trump.

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Topshee said it would take many years to build up the capacity in Canada to build subs domestically, but in the meantime both bids would include new long-term maintenance facilities that would be “Canadian jobs built with Canadian steel.”

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Earlier on Thursday, Carney met with South Korean President Lee Jae Myung, during which the leaders announced a new security and defense cooperation partnership.

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The partnership provides a framework for “accelerating defense cooperation, enhancing interoperability and readiness, strengthening defense industrial cooperation, and jointly contributing to regional and global stability,” according to a joint statement sent after the meeting.

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Lee’s spokesperson Kim Nam Joon said the president expressed hope to Carney that South Korea can actively contribute to helping Canada strengthen its defense industry and enhance its capabilities.

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“The two leaders agreed that, beyond submarines, there is significant potential for joint development in the broader defense sector, and emphasized the importance of further strengthening bilateral defense cooperation,” Kim told reporters in a briefing. 

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