50 Years of the Agency for Defense Development

Microeconomic Effects

• Defense R&D significantly contributed not only to Korea's national security but also to Korea's national economy.
  
  Over the past 50 years (1970~2019), the economic benefits were 11 times more than the investment.
• Economic benefits of KRW 442.7 trillion, 10.75 times the R&D expenditure recorded by ADD (KRW 41.2 trillion)

  Source: Analysis results reported by KIET(2020)

Cost Reduction

• The life cycle cost (LCC) of ADD’s weapon systems development is KRW 447.8 trillion (development, investment, and operation & maintenance costs) while the cost of alternative overseas weapon systems' acquisition is estimated at KRW 810.3 trillion — equivalent to cost reductions of KRW 362.5 trillion.
  
  * The estimated benefit-to-cost ratio of ADD's weapon system development (KRW 41.2 trillion) is 8.8.

Force Augmentation

• Added value is estimated at KRW 66.9 trillion compared to importing alternative overseas weapon systems.
  
  * The estimated benefit-to-cost ratio of ADD's weapon system development (KRW 41.2 trillion) is 1.62.

Impacts of Technology

• Added value of dissemination and diffusion of technology to private and other defense sectors is estimated at KRW 2.8 trillion.

Contribution to the National Economic Development

• The economic growth between 1970 and 2019 (growth rate of 7.05%) was fueled by national R&D's economic effects (38.7%) where ADD constitutes 3.83% (KRW 70.4 trillion) of the total R&D impact.

Contribution to the National Science and Technology (S&T) Development 

• The percentage of ADD’s contribution to the development of national S&T (1970-2019) is estimated at 9.5%.