CANBERRA (BLOOMBERG) – Australia has agreed to buy artillery from South Korea and increase ties between their defence industries as the nations cemented a new comprehensive security partnership amid increasing tensions with China.

The countries also pledged to boost critical minerals and clean-energy trade in pacts signed by President Moon Jae-in and Australian Prime Minister Scott Morrison in Canberra on Monday (Dec 13).

It was the first visit by an international leader to the nation since it started reopening its border this month.

“We share a view about the role of liberal democracies in today’s world and particularly in the Indo-Pacific,” Mr Morrison told reporters after signing the four pacts.

“We understand how important it is for the rule of law, for multilateral organisations that are based on a world order that favours freedom, that countries in our own region can have choices, choices in their economy, choices for their peace and security.”

The contract is worth A$1 billion (S$978 million) and is for the K9 Thunder, a self-propelled 155mm howitzer manufactured by Hanwha Defence of South Korea. The weapon has also been sold to six other countries, including India and Turkey.

Mr Moon said he and Mr Morrison agreed to work together to boost regional peace and stability. 

But the two nations are taking different paths when it comes to the Beijing Winter Olympics, with Australia backing the US-led diplomatic boycott of the games.

Mr Moon said South Korea was not considering a similar move against China, its biggest trading partner. 

The talks come as Mr Morrison seeks stronger security ties with “like-minded democracies” in a bid to act as a counter to what he sees as China’s increasing assertiveness in the Indo-Pacific.

Beijing was angered by Australia’s pact with the United Kingdom and United States, announced in September, to help build a new fleet of nuclear submarines, saying the new Aukus partnership would stoke an “arms race” in the region.

Australia’s ties with Beijing have deteriorated dramatically, with China imposing a range of trade reprisals on the nation in the wake of calls by Mr Morrison’s government last year to send independent investigators into Wuhan to probe the origins of the coronavirus pandemic.

South Korea has been worried about Chinese naval activity near its islands in the Yellow Sea, also known as the West Sea on the Korean peninsula.

The moves could indicate that Beijing is also worried about a scenario in which the US imposes a blockade close to its shores. While South Korea was Australia’s fourth-largest trading partner in 2020, worth A$34.9 billion, coal and natural gas make up more than a third of its exports to the Asian nation. 

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The terms of that trading relationship will need to change as both nations pledge to cut carbon emissions in the coming decades.

Mr Morrison is seeking to establish a green hydrogen export market. He has also inked initial deals with the US to develop a critical minerals industry, with the metals used in clean-energy technology, such as in battery storage, in high demand in a market dominated by China.   

Mr Moon’s visit to Australia, which includes a trip to Sydney on Tuesday for meetings with political leaders, coincides with the 60th anniversary of diplomatic ties being established between the two countries. 

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