Korea Aerospace Industries (KAI) has struck a US$1.1 billion deal with Iraq to supply light fighters, as the South Korean firm seeks to tap into the Middle East defence market.
Under the deal, KAI will supply 24 T-50 jets, provide training to Iraqi pilots, and provide support services to the Iraqi air force over the next two decades.
That could push the value of the deal to $2bn, KAI said.
Saj Ahmad, the chief analyst at StrategicAero Research, said Iraq was balancing its commercial aviation needs with investment in defence equipment, and the KAI deal came as little surprise.
“At a time when global defence budgets are being squeezed, Iraq represents one of the few but highly lucrative markets for defence deals and growth, and it is clear that [South] Korea didn’t want to sit on the sidelines for too long,” he said.
According to the World Bank, Iraq’s military expenditure has almost doubled to 7.06 trillion Iraqi dinars (Dh22.31 billion) last year, from 3.6tn dinars in 2009.
The FA-50 is a light attack variant of the T-50 Golden Eagle supersonic trainer jointly developed by KAI and United States defence firm Lockheed Martin, according to Yonhap, the South Korean news agency.
The Iraqi version of the FA-50, named the T-50 IQ, is equipped with machine guns, air-to-air and air-to-surface missiles, and precision-guided bombs.
Ha Sung-yong, KAI’s president and chief executive, said: “I think that the T-50 is the most optimal aircraft suitable for Iraqi military operations.
“The T-50 is the most suitable type for the next-generation fighter drills, so the prospect of exporting T-50 aircraft is promising.
“Also, the T-50 can be operated in a flexible manner ranging from an advanced trainer to a low-class fighter jet.”
Delivery of the jets was scheduled between 2015 and 2016, Yonhap reported.
KAI introduced the T-50-variant aircraft to Iraqi prime minister Nouri al-Maliki during his visit to South Korea in April 2011. In July that year, the Korean firm started sale negotiations with Iraq.
KAI currently markets its aircraft to the Philippines, Chile and Botswana. It aims to be a top player in the global aerospace industry by 2020. It also aims to raise its revenue to $10bn over the next seven years.