Amid escalating trade tensions between the United States and China, the South Korean defense giant Hanwha’s subsidiary was sanctioned by the Chinese Communist Party on Tuesday (October 14th). At the same time, the company is actively shifting its focus towards Southeast Asia, considering marketing its newly developed anti-ship ballistic missiles to the Philippines to counter China’s aggressive expansion in the South China Sea.
The Chinese Ministry of Commerce announced on Tuesday that sanctions were imposed on five US-related subsidiaries of Hanwha Ocean, a South Korean shipbuilder under Hanwha, prohibiting transactions and cooperation with them. Beijing claimed that these subsidiaries assisted US government “related investigative activities” in the shipping industry, posing a threat to China’s sovereignty, security, and development interests.
The sanctioned entities under Hanwha include its Philadelphia shipyard in the United States, responsible for repairing US military vessels and building merchant ships flying the US flag.
According to Reuters analysis, since these sanctioned subsidiaries have no direct business ties with China, the sanctions are not expected to have an immediate impact in the short term, appearing more as a gesture made by Beijing amid the escalating US-China trade war (with both sides recently imposing port charges on each other).
On the same day that China announced the sanctions, a company representative at the Association of the United States Army’s 2025 Annual Meeting and Exposition (AUSA 2025) military professional exhibition and development forum told Naval News that Hanwha is seeking to sell its developing CTM-ASBM (anti-ship ballistic missile) system to the Philippines. The Hanwha representative stated that this is in response to the “increasing demand from customers for anti-ship capabilities.”
The missile will be paired with Hanwha’s K239 “Chunmoo” mobile multiple rocket launcher system, with a range of up to 160 kilometers, and will be equipped with a proprietary guidance head for “precisely targeting ships at sea.” The development of this system is expected to be completed by 2028.
Hanwha sees the Philippines as a potential customer, leveraging the fact that Philippine authorities are refocusing on long-range precision firepower in their military modernization to enhance maritime deterrence capabilities in the South China Sea (West Philippine Sea).
In recent years, Philippine defense officials have actively acquired anti-ship weapons such as the supersonic BrahMos missile from India and are considering incorporating Hanwha’s “Chunmoo” system into their artillery modernization plan. These highly mobile, long-range missile systems are key defense capabilities for the Philippines against threats from the Chinese Navy.
Analysts believe that while the Chinese sanctions have made investors nervous about Hanwha’s stock price, conflicts between the US and China may actually stimulate global orders for naval vessels and related weapons, providing more opportunities for defense companies like Hanwha.
On Wednesday, Hanwha Ocean’s stock price rebounded by 1.8%, while its competitor HD Hyundai Heavy saw a 2.2% increase, recovering some of the losses from Tuesday.
(Report compiled from Reuters, Naval News, and other relevant sources.)