Gumi City Solidifies Position as South Korean Defense Hub with LIG Nex1 Investment
Gumi, South Korea – – Gumi City is poised to become a central production base for South Korea’s defense industry following a significant investment agreement with LIG Nex1 Co., Ltd. The agreement, formalized on , will see LIG Nex1 invest a total of KRW 370 billion (approximately $275 million USD based on current exchange rates) in a dedicated defense production facility within the Gumi National Industrial Complex.
The investment, slated to be completed by 2029, is expected to create 200 new jobs and significantly expand the production capacity of core defense products, including guided weapons and precision weapon systems. The move underscores a broader trend within South Korea to bolster its domestic defense capabilities and reduce reliance on foreign-made systems.
The signing ceremony, held at Gumi City Hall, was attended by key figures including LIG Nex1 Vice President Park Bae-ho, Gyeongbuk Province Governor Lee Cheol-woo, and Gumi Mayor Kim Jang-ho. Representatives from the Gumi City Council and related organizations were also present, signaling the widespread support for the initiative.
Strategic Importance of Gumi and LIG Nex1
Gumi City’s growing prominence in the defense sector is largely attributed to the presence of LIG Nex1, a leading South Korean defense contractor. Recent developments, including the completion of a CIWS-II (Close-In Weapon System II) mass production facility in June 2025, have further cemented LIG Nex1’s role as a critical component of the nation’s defense infrastructure.
The newly completed CIWS-II facility, encompassing an assembly building, near-field testing facility, and a third radar system test facility, represents an investment of KRW 21 billion (approximately $15 million USD). This facility is designed to support both the development and mass production of the CIWS-II, a crucial last line of defense for naval vessels against anti-ship missiles and other close-range threats. LIG Nex1 anticipates completing the development of the CIWS-II by 2027.
The Gumi production complex is equipped with advanced radar testing infrastructure and simulation systems, positioning LIG Nex1 to meet both domestic and international demand for its defense products. This capability is particularly relevant as South Korea seeks to expand its defense exports and strengthen its position in the global arms market.
Moving Away from US Dependence
The investment in domestic production facilities, such as the CIWS-II facility, reflects a strategic shift within South Korea to reduce its dependence on US-made defense systems. The completion of the CIWS-II facility specifically aims to move away from reliance on foreign systems for short-range protection. This move is driven by a desire for greater self-sufficiency and control over its defense capabilities, particularly in light of evolving geopolitical dynamics.
Collaboration and Investment MOUs
Gumi City has been actively fostering collaboration with major defense companies and expanding its regional industrial network. During the Seoul ADEX (International Aerospace & Defense Exhibition) 2025, held in October 2025, the city hosted a networking event with LIG Nex1 and its partner companies. This event facilitated the signing of investment memoranda of understanding (MOUs) with two partner companies: Digitron Co., Ltd. And KS System Co., Ltd.
These MOUs represent a significant step in promoting joint growth within the defense industry and attracting further investment to the Gumi region. The timing of these agreements is particularly noteworthy, given the increasing importance of the defense industry in the context of the changing international situation.
Provincial and City Support
Gyeongbuk Province Governor Lee Cheol-woo emphasized the importance of this investment, stating that the agreement is “an important opportunity for Gyeongbuk to become a key production base for the Korean defense industry and a strategic base that supports the global competitiveness of the K-defense industry.” He further pledged full administrative and policy support at the provincial level to ensure the smooth implementation of LIG Nex1’s investment plans.
Gumi Mayor Kim Jang-ho echoed this sentiment, highlighting the city’s commitment to attracting defense industry companies and expanding its cooperative network. The collaborative efforts between Gumi City, Gyeongbuk Province, and LIG Nex1 demonstrate a unified approach to strengthening South Korea’s defense capabilities and fostering economic growth within the region.
The investment by LIG Nex1 is expected to not only enhance South Korea’s defense industrial base but also contribute to the economic development of Gumi City and Gyeongbuk Province, solidifying their position as key players in the nation’s defense sector.
