Breaking News: South Korea Challenges U.S. Influence with Bold $20–$24 Billion Submarine Offer to Canada.

South Korea has submitted a bold $20–$24 billion proposal to Canada for the supply of advanced KSS-III submarines, according to information published by the Canadian Broadcasting Corporation on May 5, 2025. The offer marks a significant move amid rising political and strategic tensions between Canada and the United States, particularly surrounding Canada’s potential withdrawal from the U.S.-led F-35 fighter jet program. As reported, the proposal is part of an unprecedented diplomatic and industrial push to persuade Canada to pivot away from traditional U.S. and European defense suppliers.
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South Korea’s KSS-III submarine, a state-of-the-art conventional attack submarine developed by Hanwha Ocean and Hyundai Heavy Industries, proposed as part of a $20–$24 billion offer to Canada.  (Picture source: Wikimedia)

At the heart of South Korea’s offer is the delivery of cutting-edge KSS-III submarines, developed by Hanwha Ocean and Hyundai Heavy Industries. The first four submarines are promised by 2035—well ahead of Canada's current procurement schedule under the Canadian Patrol Submarine Project (CPSP), which aims to replace the aging Victoria-class fleet. The South Korean offer not only presents a high-performance alternative to existing Western submarine platforms, but also signals a strategic deepening of defense-industrial ties between Seoul and Ottawa. As Canada increasingly looks to diversify its military partnerships, the KSS-III proposal positions South Korea as a credible and forward-leaning defense partner ready to fill gaps that might emerge from strained relations with the United States.

In July 2024, the Canadian Ministry of National Defence announced a critical milestone: the launch of a formal process to engage industry in the procurement of up to 12 conventionally powered, under-ice capable submarines. This initiative, under the Canadian Patrol Submarine Project, is a key component of Canada’s renewed defense strategy, Our North, Strong and Free. The new fleet will enable the Royal Canadian Navy to detect and deter maritime threats covertly, control maritime approaches, project power far from Canadian shores, and maintain a persistent deterrent presence across all three coasts.

According to the Canadian defense ministry, the Canadian Department of National Defence is currently meeting with manufacturers and potential partners, and a formal Request for Information (RFI) is scheduled for release in fall 2024. The RFI will solicit data on the procurement, construction, and operational capabilities of potential submarine providers, as well as their ability to support long-term sustainment and local industrial participation in Canada. The procurement also aims to establish durable strategic relationships—supporting personnel training, technology transfers, and sustained cooperation between Canada and its selected partner(s).

Canada’s key requirements for the new submarine fleet include stealth, lethality, persistence, and Arctic deployability. The future submarines must offer extended range and endurance, allowing Canada to detect, track, deter, and, if necessary, defeat maritime threats in all three oceans. These vessels will also contribute to international missions alongside allies and partners, reinforcing Canada’s strategic presence and commitments abroad.

The KSS-III, also known as the Dosan Ahn Changho-class, is well-positioned to meet these criteria. It displaces approximately 3,700 tons submerged and features fuel-cell-based Air-Independent Propulsion (AIP), allowing up to 20 days of submerged endurance. Its advanced capabilities include vertical launch systems for land-attack cruise missiles, modern sonar and combat management systems, and reduced acoustic signatures for stealth operations. These features make the KSS-III one of the most capable non-nuclear submarines on the global market.

The offer also comes as Canada reconsiders several defense agreements with the United States. Disagreements over trade policy, strategic priorities, and procurement autonomy have triggered a broader reassessment of Canada’s defense alignment. A major point of contention has been the planned purchase of 88 Lockheed Martin F-35 stealth fighters. In March 2025, just hours after being reappointed in Prime Minister Mark Carney’s new cabinet, Defence Minister Bill Blair confirmed that Canada is actively exploring alternatives to the F-35 and will engage with rival aircraft manufacturers. This policy shift underscores growing concerns in Ottawa over overreliance on U.S. defense platforms.

South Korea is seizing the moment to establish itself as a trusted alternative supplier. The country’s defense sector has achieved international success with exports such as the K9 Thunder howitzer, FA-50 fighter jet, and K2 Black Panther tank. In 2023, Hanwha Group opened discussions with Canadian industry leaders to explore co-production and localized support, aligning with Canada’s Industrial and Technological Benefits (ITB) policy, which prioritizes domestic economic and workforce contributions in defense procurements.

Strategically, both nations share core interests in Arctic security, Indo-Pacific stability, and a rules-based international order. South Korea’s submarine offer goes beyond hardware—it presents an opportunity for Canada to forge a long-term, strategically aligned defense partnership with a rising global power.

As proposals from Germany, Sweden, France, and the United States continue to be evaluated, South Korea’s KSS-III bid—backed by early delivery, strategic cooperation, and industrial integration—emerges as a compelling option. The coming months will be pivotal as Canada moves toward reshaping its defense procurement framework, potentially marking a shift toward a more diversified and autonomous national security strategy.