The Nigerian Defense Industry – Market Opportunities and Entry Strategies, Analyses and Forecasts to 2015

Active participation in UN peacekeeping missions and operations to stop the smuggling of stolen oil drove Nigeria’s defense expenditure during 2006–2010, and these factors will continue to be important over the next few years. The country’s defense budget stood at 0.8% of GDP in 2010, and is expected to increase only marginally by 2015.

London – 9 September 2011 - Nigeria prohibits direct investment in its defense sector by foreign companies, and direct selling is the only market entry route available for foreign defense operators. Key opportunities for equipment suppliers are expected in areas such as offshore patrol vessels, and multi-purpose and utility helicopters.

Nigeria’s Homeland security expenditure is primarily driven by attempts to combat extremism, drug trafficking, cyber crime and money laundering. Investment in surveillance and intelligence technologies such as electronic identification documents, e-passports, automated border crossing systems and CCTV is expected.

Revenue expenditure expected to increase during the forecast period
Nigerian defense expenditure is expected to exceed US$2.0 billion in 2011, and is forecast to reach US$2.8 billion by 2015. Capital expenditure is forecast to decline to an average of 10.0% during the 2011–2015 forecast period as a result of a reduced budget allocation for equipment purchases. Consequently, revenue expenditure’s allocation is likely to rise to 90% during the forecast period.

Homeland security expenditure expected to match defense expenditure
The country’s homeland security expenditure is expected to grow by over 8% during the forecast period to reach US$2.8 billion by 2015, primarily driven by extremism, drug trafficking, cyber crime and money laundering. In order to counter these threats, the country is expected to invest in surveillance and intelligence technologies such as electronic identification documents, e-passports, automated border crossing systems and CCTV (closed circuit television) systems.

Defense imports expected to increase while exports remain negligible
During the review period, the largest proportion of Nigeria’s defense imports came from China, due to a trade co-operation agreement between the countries. The country also has an economic partnership agreement with Italy, another key import partner. Aircraft, ships and armored vehicles dominated the country’s total arms imports during the review period, and imports are expected to increase, particularly for equipment purchases. The country does not export any arms to foreign countries as its domestic defense industry is under-developed.

To purchase the full version of the report, “The Nigerian Defense Industry – Market Opportunities and Entry Strategies, Analyses and Forecasts to 2015” please click here.

About Industry Review:
Industry Review is a collection of incisive, regularly updated market reports across 40+ industry sectors and 100+ countries.

We provide access to the latest data on global and local markets, key industries, top companies, M&A activity, new product launches and trends so you can make faster and better informed business decisions.

The reports in our store draw on robust primary and secondary research, proprietary databases, industry surveys and insightful analysis from our own expert teams and from carefully selected third-party publishers.

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China Packaging Opportunities and Entry Strategies

China has the second largest packaging industry is the world after the US, worth over US$60 billion and according to a recent study conducted by ICD Research, it is expected to rank first by 2015.

London – September 7, 2011 – In 2009, the Chinese packaging industry was adversely affected by the global economic crisis and a subsequent decline in its export market, although the domestic demand for packaging managed to offset these developments and maintain the growth of the industry. Financial stimulus packages announced by the Chinese central government were also major factors in China’s ability to avoid economic decline and maintain domestic demand.

As the world’s most populous country, with one of the fastest growing economies and a large export base, China has the twin advantages of both a strong domestic market and a sizeable export demand. While the rapid growth of the Chinese economy has necessitated the rapid development of the packaging industry in both the industrial and retail sectors, improvements in living standards and changes in consumption patterns have resulted in increased brand and quality awareness.

As a result of global economic recovery throughout 2010, several end-use markets, such as the food, beverage and pharmaceuticals industries, are expected to regain the strong levels of growth seen prior to the financial downturn. Consequently, the packaging industry is expected to increase in value to over US$100 billion by 2015.

Growth of food, beverage and pharmaceuticals industries increases demand
An increase in the average income of China’s urban population, and a shift in tastes and preferences towards western-style processed and packaged food are driving the growth of China’s food processing sector. Given that only 30% of China’s food is processed, compared to 60%–80% in developed countries, the market for processed food and beverages is set to grow rapidly.

Another key emerging end-use market is the pharmaceuticals industry, which is expected to record significant annual growth in the next five years due to increases in demographics, rural-to-urban movement, social progress and health sector reforms. This is expected to raise the demand for a range of packaging materials, such as glass bottles, PET bottles, strips and blister packs.

Use of plastic packaging expected to rise
Paper and board packaging is the single largest market sector in the Chinese packaging industry. However, plastic packaging has emerged as the fastest growing sector and is forecast to record a CAGR of over 12% the next five years. However, while metal packaging is also forecast to marginally increase its presence, the market share of glass packaging is expected to decline by 3% by 2015, as it is steadily substituted by plastic packaging.

New packaging regulations crucial to safety of Chinese packaging
In 2009, China became the world’s largest merchandise exporter, overtaking Germany for the lead position. In recent years, however, several reported cases of counterfeit and pirated consumer products, ranging from baby food and medicines to toys, causing death and serious ailment have damaged the reputation of the Chinese packaging industry. It also led to the recall of large Chinese product shipments by leading global retail giants.

In an effort to improve safety and hygiene levels, the Chinese government passed rigid packaging regulations and also enacted a new Food Safety Law to improve packaging standards. The move is likely to benefit the packaging industry, as major end-use industries are required to invest larger amounts in packaging to ensure the safety and authenticity of products.

Government incentives to decrease
China’s entry to the World Trade Organization (WTO) and the fulfillment of its obligations to ensure fair trade require the government to withdraw its subsidies or scale down its incentives to the goods and services industries, including packaging.

China’s central government has actively pursued a policy to develop the country’s packaging industry in order to support industrial growth. In the past decade, it has invested in equipment and technology, and has provided incentives in the form of subsidies, tax concessions and infrastructure facilities to improve and upgrade the capability of the country’s packaging industry.

A reduction in government support is expected to affect the cost advantages enjoyed by domestic packaging businesses, while attracting more foreign companies into specialist packaging, metal packaging and high-end equipment manufacturing.

To purchase the full version of the report, “The Chinese Packaging Industry – Market Opportunities and Entry Strategies, Analyses and Forecasts to 2015,” please click here.

About Industry Review:
Industry Review is a collection of incisive, regularly updated market reports across 40+ industry sectors and 100+ countries.

We provide access to the latest data on global and local markets, key industries, top companies, M&A activity, new product launches and trends so you can make faster and better informed business decisions.

The reports in our store draw on robust primary and secondary research, proprietary databases, industry surveys and insightful analysis from our own expert teams and from carefully selected third-party publishers.

With access to over 400 in-house analysts and journalists, and a global media presence in over 30 industries, Industry Review delivers in-depth knowledge of local markets worldwide.

For more information, please visit our website at www.industryreview.com

For more information on the article, please contact:

Press Contact:
Shelly Wills
Tel: +44 (0) 20 7936 6671
shelly.wills@industryreview.com