Page 143 - 2018 Defense White Paper

explore defense export opportunities. To foster an active export-oriented defense industry and

create jobs, the government has set up the “Basic Plan for Defense Industry Promotion for
2018–2022” and is proactively adopting active export programs. By 2019, the offset trade 18)
program, which focuses on the acquisition of defense technologies, will be converted into the

Industrial Cooperation 19) program that aims to foster the defense industry, promote exports,
and create jobs. The Banking 20) program and the Industrial Cooperation Quota program 21) are
also planned to be introduced.

To diversify export items and methods to proactively respond to customer countries’ demands,
the revision of relevant laws and regulations is underway to enable the DAPA to directly sell
defense articles in the event that foreign governments make such requests. The MND is also

developing diverse export methods including the sales of used arms, leasing, and the export
of a comprehensive range of goods and services as a package. In addition, there are plans to
build infrastructure for more specialized and systematic support through the creation of the
Defense Export Support Group (provisional name), a team dedicated to defense export, within Chapter 4

the DTAQ in 2019 and the launching of the “Defense Industry Promotion Institute Agency”
(provisional name).

To promote defense cooperation with the governments of defense consumer countries, the
MND will continue its intergovernmental cooperation ef forts including signing agreements on
defense industry logistics support, organizing defense industry and logistics joint committee
meetings, and arranging exchanges of high-level defense off icials. It will also strengthen overseas

local support activities through the expansion of the program to dispatch defense industrial

18) A trade in which a buyer of foreign weapons and equipment receives certain reciprocal services, such as
technology transfer and guaranteed export of domestic military supplies, from the foreign counterpart to the
contract
19) The practice of, when buying weapons and equipment from abroad, proposing a joint development and
production of parts and technologies or a joint investment to the foreign counterpart of the contract, or
mandating a certain cooperative relationship such as a cooperation on exports of domestic parts and
technologies
20) The practice of a foreign company fulfilling its offset trade obligations in advance regardless of obligations
associated with its current projects, thereby accumulating the offset trade credit, which it can utilize for future
projects
21) It is a program that, in a purchase of a weapon system from abroad, mandates a certain proportion of the
basic contract price paid with domestic companies’ parts and services. The program aims to expand export
opportunities and foster the defense industry.

Section 4 Improving the Transparency of the Defense Acquisition Program and the Competitiveness of the Defense Industry 141