KAI CEO calls for swift resolution with Indonesia on KF-21 issues

Korea Herald

22-05-2025

By Hwang Joo-young and Joint Press Corps
LANGKAWI, Malaysia — Korea Aerospace Industries CEO Kang Goo-young on Wednesday expressed hopes for a swift resolution to tensions with Indonesia, which joined the company as a key partner in 2016 in the development of the KF-21 fighter jet — KAI's most advanced 4.5-generation aircraft project.
The partnership has soured since 2023, when several Indonesian technical researchers were caught attempting to remove sensitive files from the joint development site in Korea using an unauthorized USB device. Five of the personnel are under investigation and remain banned from leaving the country, which is believed to be a source of growing dissatisfaction in Jakarta.
Speaking with South Korean reporters at the LIMA 2025 defense exhibition in Langkawi, Kang said the issue should be 'resolved amicably within the legal framework,' expressing concerns that prolonged friction with Indonesia could complicate broader efforts to promote the KF-21 across the region.
Despite speculation that Indonesia may be preparing to withdraw from the KF-21 program, Kang said he does not believe that to be the case.
Indonesia still owes about 200 billion won ($145.8 million) in development costs — 100 billion won for this year and another 100 billion for next year — and according to Kang, the Indonesian government has already budgeted the 2024 payment.
"That's not a signal of withdrawal," he said, adding that Indonesia is closely monitoring the KF-21's progress and is unlikely to walk away easily.
Still, Kang acknowledged that deteriorating ties with Jakarta could shift the regional dynamic. He pointed to Indonesia's growing interest in co-developing Turkey's next-generation fighter, the KAAN, and said that if Malaysia were to join such an initiative, it could complicate South Korea's broader ambitions in Southeast Asia.
Restoring cooperation with Indonesia, he stressed, is not just about preserving bilateral ties — it's also about maintaining strategic footing in a competitive market. Kang noted that many Southeast Asian countries view China as a growing security concern.
'In the past, China used battleships to project power,' he said. 'Now it's aircraft carriers.' This shift, he added, is prompting countries such as Indonesia, the Philippines and Malaysia to seek high-performance fighter jets. Although many would prefer the F-35, US export restrictions make that difficult, giving the KF-21 an opening.
Interest in the aircraft is also growing. According to Kang, a high-ranking Malaysian official visited the KAI booth during the exhibition and asked how the KF-21 compares with China's J-10 fighter. On May 7, a Pakistani J-10 reportedly shot down a Rafale fighter from the Indian Air Force, which had acquired the jets from France.
In that conversation, Kang said he positioned the KF-21 as a cost-effective but high-performance alternative to European fighters. 'Compared to 4.5-generation jets like the Rafale or Eurofighter, the KF-21 delivers 150 percent of the performance at 70 to 80 percent of the cost,' he told the official.
In an effort to keep the partnership with Indonesia on track, South Korea has offered to reduce the country's share of development costs from 1.6 trillion won to 600 billion won. However, Jakarta has not officially responded.
KAI has also submitted multiple petitions to the South Korean authorities requesting leniency for the Indonesian personnel involved in the data breach, arguing that the leaked materials likely did not contain core technical information.
'We hope this can be resolved through political and diplomatic channels,' Kang said. 'From a national interest standpoint, it's time to move beyond this dispute.'