TURKEY COOPERATES WITH KOREA TO DEVELOP A NATIONAL MAIN BATTLE TANK

Turkey continues to announce new armament programs that involve the development and production of a “Turkish brand” of major weapons systems. On July 29, under a technology cooperation deal signed between Turkey and South Korea (ROK), Turkey initiated a $500 million project for the design, development and production of prototypes for its next-generation, locally manufactured main battle tank (MTB), named Altay. Four prototypes are to be produced in the next six and a half years, to be followed by an initial production of 250 tanks. Eventually, Turkey plans to replace all its MBTs, as many 1,000, which will become obsolete in the next few decades (Hurriyet, Sabah and Radikal, July 30).

In June, Turkey initiated a project for the development of a national attack helicopter in cooperation with the Italian AugustaWestland (EDM, June 27). On July 22 Turkey awarded a contract for new submarines to the German Howaldtswerke-Deutsche Werft (HDW). Under the $4 billion deal, HDW agreed to transfer technology and equipment for the production of six of its U-214 class submarines in Golcuk shipyard. Turkish industry’s contribution to the project will amount to 80 percent of the total value of the contract, signifying Turkey’s bargaining power (Hurriyet, July 23).

The trajectory of the MTB project is similar to that of the helicopter project. The procurement of an eventual 1,000 third-generation tanks, worth over $10 billion, first came to the agenda when Turkey began considering ambitious military modernization projects in the 1990s. The original program, which sought local production under foreign licenses, had to be shelved due to the economic crisis of 2000-2001. In the meantime, Turkey signed agreements with Israel to upgrade its aging MBT inventory, composed mainly of German Leopard and U.S. M60T tanks (Dr Andrew McGregor, “Arming for Asymmetric Warfare: Turkey’s Arms Industry in the 21st Century” Jamestown Foundation, June 19). Turkey’s attempts to revitalize the project hit a deadlock over questions about the modality of procurement, and it was suspended once again in 2004, the year when Turkey decided to overhaul its entire range of defense projects and made technology transfers and the enhancement of local contributions its blueprint for future tenders (Zaman, May 21, 2004). The Undersecretariat for Defense Industries (SSM) commissioned a report to Otokar, BMC and FNSS, the major local armored vehicle producers and the bidders in the MBT project, about the optimum means of realizing the project (Aksam, July 30, 2004). When their report confirmed the capability of Turkish industry to develop and manufacture a nationally designed tank, including systems integration work, through the provision of foreign technological assistance, Turkish authorities opted for the domestically manufactured model (Turkish Daily News, October 20, 2005). In addition to the expertise that local industry developed in armored vehicles and firing systems, the tank modernization projects carried out with Israel, one of which involved technology transfers and domestic participation, also made a substantial contribution to Turkey’s infrastructure in this field (Turkish Daily News, April 6, 2002).

The competition, announced in 2005, was open only to domestic manufacturers that were active in the production of military vehicles and had supplied the Turkish army previously; foreign producers were limited to providing technology (Ortadogu, February 10, 2006). In March 2007 the SSM decided to start negotiations with Otokar, Turkey’s largest arms exporter owned by the major business and industrial group Koc Holding, to develop, design and manufacture the next-generation of MBTs. Otokar accounts for 30 percent of Turkey’s defense exports and sells mainly armored and non-armored vehicles to more than 15 countries (www.otokar.com). Otokar’s local subcontractors were military-owned ASELSAN, an ASELSAN-STM joint initiative, and the state-owned MKEK for the gun barrel. After extensive research, in June 2007 the SSM selected Korean Hyundai-Rotem over the German Krauss Maffei Wegmann as the foreign subcontractor for providing technology (SSM Press Brief, June 20, 2007). In what was the second largest export deal for the Korean arms industry, ROK will transfer the technology of its next-generation tank XK-2, Black Panther, and sell its training airplanes to the Turkish Air Force (Chosun Ilbo, June 22, 2007).

The July 29 ceremony for signing the $500 million contract, held at Otokar’s plant in Sakarya, was attended by Turkish Prime Minister Recep Tayyip Erdogan and Korean Defense Minister Lee Sang-hee. Erdogan asked the contractors to complete the project earlier and stressed that by 2011 Turkey would be producing 50 percent of its military’s needs locally. Sang-hee expressed the hope that cooperation would be deepened between the “blood brothers,” a reference to Turkey’s contribution to the Korean war, in the field of high-tech defense procurement. Kudret Onen, the chairman of Otokar, the main contractor, underlined the pioneering role the company played in the defense industry and its technological infrastructure in carrying out this challenging project that will make Turkey one of the few nations to produce MBTs.

ROK will transfer technology owned by the state developer, the Agency for Defense Development, which will amount to around 50 percent of the technology required to develop the prototype. According to the Korean sources, ROK will receive $400 million in technology transfer fees, which marks a turning point for Korea’s defense programs (Korean Ministry of National Defense; www.korea.net, July 30). ASELSAN will supply the fire control systems called Volkan, and the ASELSAN-STM joint initiative command will manufacture the control and information systems, which are already developed and used in the upgraded MBTs (www.aselsan.com). MKEK will produce the gun barrel, which has already been developed as part of the modernization project with Israel, while Roketsan will design the modular armor. The feasibility work on the engine will continue; it might be produced under a foreign license or be developed internally. Turkey will have the full rights over the final product including export licenses. It was, however, noted by Chief of Staff Yasar Buyukanit that South Korea inserted a clause in the contract prohibiting the export of the tank to North Korea, Japan and China (Milliyet, August 1).

The recent bid shows once again that Turkey remains committed to developing its domestic defense industry through diversifying its international partners. The inability of U.S. manufacturers to compete in Turkey’s arms procurement programs due to U.S. export regulations has opened new windows of opportunity for exploring alternative suppliers, which may result in building new partnerships to lessen the dependence on the United States. In addition to increasing the firepower of the Turkish army, Turkish authorities hope that the project will help upgrade local technology as Turkish subcontractors will have to improve their quality to meet the high standards of the project. It then will generate new momentum for streamlining cooperation among companies active in the defense industry, helping Turkey emerge as a major player in the worldwide arms industry.