Analyzing the Economic Impact of a Warship MRO Business : Based on the Interindustry Analysis

In recent years, the world has been experiencing geopolitical instability, such as the U.S and Chinese hegemonic rivalry and Russia,s invasion of Ukraine, as well as competing maritime jurisdictions of littoral states, so great powers are interested in acquiring weapons systems and performing MRO of naval vessels for their own national security. Currently, the Koren Navy is at a point where it is inevitable to expand the MRO business for advanced ships based on advanced science and technology due to the declining troop numbers, and Korea needs to preempt and lead the global defense market in a broader sense by revitalizing exports. In particular, the U.S. plans to release 20 trillion won worth of ship MRO to overseas markets for the purpose of s trengthening naval power, so I would l ik e to s tudy how the ship MRO industry will affect Korea’s industry economically in the future. In this study, we analyze the economic impact of the shipbuilding MRO industry on other industries and the Korean economy using the 2019-based interindustry relations table released by the Bank of Korea in September 2021. To exogenize the warship MRO industry, we reclassified the interindustry relations table through interviews with a group of experts and adopted 10 items as subcategories using the 2015 actual table and the 2019 extended table, and presendted the basic sector as 25 items. As a result, the production induced effect was 0.786 and the value added induced effect was 0.304. The employment induced effect was 3.235 people per billion won, The sensitivity coefficient of the warship MRO industry is 1.259 and the influence coefficient is 1.130 indicating that the forward linkage effect of the trap MRO industry is larger than the backward linkage effect and that the warship MRO industry has a larger production-inducing effect on other industries on average. In f uture research, we w ould lik e to analyze the e conomic impact o f the warship MRO industry b y breaking it down into submarines, surface ships, and military support ships and expand the study to include the new ship construction industry as well as the MRO industry to see how it affects other industries and the national economy based on interindustry analysis.