The Taiwanese Defense Industry - Market Opportunities and Entry Strategies, Analyses and Forecasts to 2015

With a strained relationship with China, aging defense hardware and an underdeveloped domestic defense industry, Taiwan’s defense industry is under pressure. Equipment upgrades and homeland security issues are two key issues set to drive spending until 2015.

London, January 31, 2012 – Taiwan’s military expenditure is expected to be driven by factors such as a strained relationship with China and the acquisition of advanced defense systems. Rapid defense modernization plans being pursued by China have also compelled the nation to enhance the capabilities of its armed forces.

According to detailed ICD research, the country’s defense budget as a percentage of GDP is likely to increase from 2.0% in 2011 to 2.2% in 2015, and during the 2011–2015 research forecast period the country’s defense spending growth rate is expected to correlate closely with the nation’s GDP growth rate. Taiwan’s defense budget has grown at a compound annual growth rate (CAGR) of 5.02% since 2006, and is projected to grow at a CAGR of 7.77% from 2011 – 2015.

Revenue expenditure dominates Taiwan’s defense budget, but capital expenditure is set to increase during 2011-2015

During the 2006–2010 research review period, the country spent over 90% of its total defense budget on revenue expenses, while less than 10% allocated for capital expenditure. However, during the forecast period, capital expenditures share is expected to increase to an average of 12%, largely due to the country’s focus on acquiring advanced defense systems and plans to reduce its troop size by 20% by 2014. As a consequence, defense equipment suppliers will experience a surge in demand for advanced systems such as fighter aircraft, military helicopters, missiles, warships and submarines.

The country’s homeland security spending is expected to increase at a CAGR of 11.95% during the forecast period.

The country’s homeland security spending recorded a CAGR of 1.69% during the review period, and is expected to record a CAGR of 11.95% during the forecast period. The nation’s homeland security budget is driven by an increase in human trafficking, illicit drug trading and maritime security threats. Over the next five years, significant investment is expected in equipment capable of countering maritime as well as security threats. Consequently, demand for surveillance equipment such as CCTVs and biometric identification systems is expected to increase during the forecast period.

The US accounts for the majority of arms supply to the country

Taiwan’s domestic defense industry is unable to manufacture advanced defense systems, as a result of which the country depends on foreign OEMs to meet its military requirements. However, as the country focuses on enhancing the capabilities of its domestic defense industries, its overall level of expenditure on arms imports is not expected to increase significantly during the forecast period. Over the past five years the US has emerged as the largest supplier of defense equipment to the country. While ships accounted for the highest expenditure on imported military hardware in 2010, investment in aerial defense systems is expected to increase during the forecast period.

Foreign OEMs venture into the market through defense exhibition and direct commercial sales
The country has hosted the biennial Taipei Aerospace and Defense Technology Exhibition since 1991, which provides overseas investors with an opportunity to access the country’s defense market. In 2009, an estimated 97 exhibitors participated in the exhibition, including Saab, Northrop Grumman, ITT, Raytheon, L-3 and Lockheed Martin, among others. The nation’s domestic defense capabilities are largely underdeveloped, as a result of which a large number of foreign suppliers have entered the market by directly selling arms.

Defense budget cuts, corruption and lack of transparency hamper the Taiwanese defense industry

Lack of transparency and corruption within the government’s procurement process hamper the entry of foreign investors into Taiwan’s defense sector, and there have been instances where foreign investors have resorted to paying bribes in order to win procurement contracts. Additionally, government policy requires all foreign defense procurements within the country to be finalized through local agents, who receive a commission for every deal they finalize, and the bribing of these local agents by suppliers is common. This type of malpractice within the government procurement process discourages other investors from entering the country’s defense market.

The growth of the Taiwanese defense industry is hindered by project delays caused by financial shortages. The global economic slowdown has reduced the country’s military spending, with certain defense procurement programs either postponed or cancelled. All these factors impede the entry of foreign OEMs into the country’s defense sector.

To purchase the full report, 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

The Future of Construction in the Netherlands to 2015: Revival in Export and Consumer Confidence to Stimulate Construction

London, January 30, 2012 – Residential construction was the largest market within the Dutch construction industry in 2010, representing a share of 42.4%. Infrastructure construction was the fastest growing market over the review period with a CAGR of 4.10%. This was followed by industrial construction with a CAGR of 1.70% (reference Figure 1 below).


The Dutch economy recorded 26 years of continuous economic growth before contracting in 2009 on the back of the global financial crisis. The crisis affected the country relatively late compared to other EU nations, which helped the economy to grow by 4.3% in 2008. However, as the Dutch economy is highly dependent on international trade, a 4.1% contraction in 2009 had a negative effect on growth. The economy is expected to recover in 2011, with growth anticipated to be highly dependent on the revival of demand from export destinations like the UK, Germany, Belgium and the US.

The Dutch government introduced stimulus packages to revive economic activity and made assurances that it wouldn’t roll back stimulus spending until 2012. As a result, the country that observed a tight labor market until 2008 saw its unemployment rate growing from 3.4% in 2009 to 5.1% by the end of 2010. Further improvements are expected in 2011, with a rise in employment, consumer confidence and spending increases. High domestic demand led to increases in commercial construction activity. The consolidation that is taking place in the retail industry is also expected to advance Dutch commercial construction activity.

Being an open economy and having non-discriminate business policies helped the Netherlands to attract large amounts of foreign direct investments (FDIs), opening up the market place to international firms. The industrial construction market registered a CAGR of 1.70% during 2006–2010.

In 2009 the Dutch government announced several tax incentives for companies that conduct exploration and production work in these smaller fields. In addition to tax incentives, the government also pledged to provide financial and technical assistance. These incentives attracted several domestic and international competitors to establish further operations in the Netherlands.

As part of its policies to encourage innovation the Dutch government introduced a program called Innovation Box through which it provided tax incentives for self-developed intangible assets. From January 2010, the effective corporate income tax rate was reduced to 5% from 10% for all eligible intangible assets. These incentives encouraged research and development companies to establish operations in the Netherlands.

To purchase the full report, 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

The Global Missiles and Missile Defense Systems Market 2011–2021

London, January 26, 2012 – The missiles and missile defense systems market consists of seven categories of missiles: surface-to-surface missiles (SSMs), surface-to-air missiles (SAMs), air-to-surface missiles (ASMs), air-to-air missiles (AAMs), anti-ship missiles, anti-tank missiles and missile defense systems. The value of the market is expected to increase at a CAGR of 2.41% during the forecast period (reference see figure 1 below).

Current innovations are oriented towards increasing speed with hypersonic missiles, shooting down missiles in mid-air with interceptors, enhancing anti-aircraft carrier capabilities, increasing payload capacity, facilitating navigation, and introducing stealth capabilities. The global defense industry is investing significantly in the development of technologies to enhance the speed, accuracy and destructive power of missiles. The global economic slowdown has reduced military expenditure worldwide, as a consequence of which a significant number of countries are establishing joint projects in order to share R&D costs.

Despite budget cuts, North America is expected to account for the largest share of the total global expenditure on missiles and missile defense systems with a 35.6% share in the forecast period. High demand in the region is primarily driven by the country’s five major missile defense programs.

A number of countries worldwide are planning to increase their nuclear capabilities and missile strike ranges. Countries such as the US, India, Russia, Israel, China, Italy, Germany, France, Spain, Sweden and the UK are procuring long-range ICBMs which are capable of hitting targets at distances of up to 6,000 kilometers.

The US and its allies believe that North Korea will develop an ICBM in the next five years. Taking into account the volatile relationship between the US and North Korea, this development could pose a significant threat to the security of the US, South Korea and many countries in Europe. The sinking of South Korea’s Cheonan warship by North Korea in 2010, and the testing of its nuclear weapon in 2009, have further strained relations between the two countries.

Foreign OEMs seeking to enter a specific missiles market often enter into marketing agreements with domestic companies to gain an opportunity to market their products in a specific region. For example, in August 2011, Raytheon of the US and Israel's Rafael Advanced Defense Systems Ltd teamed up to market the Iron Dome weapon system in the US.

To purchase the full version of the report, 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

The Future of Construction in Croatia to 2015: EU Integration and Infrastructure Investment to Stimulate Construction

The global financial crisis affected the Croatian economy badly, and its construction industry lost 6.0% in 2009 and a further 17.1% in 2010.

London, January 25, 2012 – Within the Croatian construction industry, infrastructure construction was the largest market in 2010, with a share of 48.6%. In terms of growth, residential construction was the fastest-growing market over the review period, with a CAGR of 4.56%. This was followed by industrial construction, with a CAGR of 3.26% (reference figure 1 below).

Croatia was one of the few emerging countries in Europe that failed to cope with the global crisis in 2009 and 2010. Despite conservative monetary policies and a well-capitalized banking and financial structure, the Croatian economy slumped in 2010 and the construction industry declined. Declining budget revenues and uncertainty about the pace of the economic recovery led to the government revising its budget three times. The construction industry depends largely on public-sector investments, with most projects coming from the government.

Croatia’s economy, as well as its construction sector, are expected to recover in 2011, albeit marginally. The economic recovery is, however, subject to uncertainty as the country has a high external debt that is coming to maturity in the short term. World Bank estimates put Croatia’s external debt at 87% of its GDP, as of mid-2009. This upcoming debt maturity and tight domestic and external financing conditions leave the Croatian economy with the difficult task of recording a notable recovery in 2011.

The Croatian construction industry grew at a CAGR of 0.25% in the review period. The global financial crisis affected the Croatian economy badly, and its construction industry lost 6.0% in 2009 and a further 17.1% in 2010. In 2009, the country’s credit markets remained frozen because of the government’s refinancing needs, and as a result were unable to provide any stimulus to the market.

The Croatian construction industry is expected to witness a marginal growth of 2.1% during 2010, and is expected to grow at a CAGR of 3.13% over the forecast period. Growth is expected to be led primarily by the infrastructure construction market, which is forecast to grow at a CAGR of 4.36% during the forecast period. It has followed a similar trend to the European construction industry over the last few years, with smaller companies being able to adapt more easily to changing market conditions. As a result, there are growing numbers of small companies, while the number of large companies has dropped.

To purchase the full version of the report, 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

The Turkish Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016

Turkey is one of the largest defense spending countries in the world and ranks among the world’s top fifteen defense spending countries. The size of the Turkish defense budget has attracted numerous foreign OEMs to establish joint ventures in the country. From 2011 to 2016 (the forecast period), Turkey is expected to register similar growth to countries such as Israel and Japan (reference see figure 13 below).

London, January 2012 –Turkey is one of Asia’s most attractive defense markets. Over the forecast period, defense expenditure is expected to grow steadily, primarily due to the threat posed by the political unrest in neighboring countries, terrorism, and peacekeeping missions. The capital expenditure allocation of the defense budget is expected to increase from the current level of 18%, to 21% by 2016, as the country enters the next cycle of its military modernization program. As a percentage of GDP, the country’s defense budget in 2010 was 1.92%. The Turkish homeland security market is driven by factors such as terror threats and maritime security needs. The country meets the majority of its defense requirements through imports, and was ranked twelfth in the list of countries with the largest defense imports during 2005–2010 (the review period).

Despite the global economic downturn in 2009, the country’s arms imports registered an increase of 17% over the previous year. Throughout the review period, Germany emerged as the largest supplier of arms to Turkey, with a market share of 48.1%. However, in 2010, the US accounted for the majority of the country’s arms imports. During the forecast period, Turkish defense imports will be dominated by Western European suppliers such as Germany and Italy, as a result of the deterioration of Turkish-Israeli relations due to the Israeli government’s refusal to issue an apology for the attack of a humanitarian aid flotilla in international waters, an incident which resulted in the deaths of nine Turkish nationals.

Foreign OEMs enter the Turkish defense market through the formation of joint ventures or strategic alliances with domestic defense firms. During the last 20 years, firms such as Tusas Engine Industries, Inc (TEI) and FNSS have been formed by foreign investors through joint ventures with domestic firms in order to fulfill offset obligations. However, following this, foreign defense firms have partnered with domestic companies in order to develop and supply products. In 2010, Raytheon adopted this strategy by collaborating with Turkish military electronics manufacturer Aselsan. In addition, foreign investors also collaborate with domestic research organizations such as the Middle East Technical University (METU), Istanbul Technical University (ITU), Bogazici University, Bilkent University, Anadolu University, Gazi University and Yeditepe University to develop and produce new defense equipment.

The Turkish defense industry faces considerable challenges due to high levels of corruption. A number of personnel within the defense industry share close relations with procurement officials and exercise monetary influence over such officials in order to win defense contracts. In order to win contracts, foreign investors are therefore compelled to pay substantial sums of money, a factor which discourages the entry of new companies into the market. Furthermore, Turkey is approaching the completion of its military equipment acquisition cycle, and the ongoing impact of the global financial crisis has resulted in the delay, postponement or cancellation of several of its procurement programs. The country also faces indefinite delays in the completion of projects, which has led to cost overruns.

To purchase the full report, please click here.

The Future of Construction in Bulgaria - EU Funds and FDI Fuel Growth

Bulgaria's integration into the EU in 2007 established suitable conditions for construction industry growth as investments for development, especially in the infrastructure market, were made.

London, January 18, 2012 – Infrastructure construction was the largest market in 2010, representing a share of 36.9%. Moreover the market was the fastest growing over the review period, with a CAGR of 18.84%. This was followed by institutional construction with a CAGR of 15.10% (reference figure 1 below).

Bulgaria, situated in Southeast Europe, is an industrialized free market and upper income country as specified by the World Bank. In 2010, the services sector accounted for 64.6% of the county’s GDP, followed by industries, comprising 30.1% and agriculture, accounting for 5.3%. Bulgaria recorded an average annual growth rate of 6% during 2004–2008 following economic reforms since the 1990s, which saw the country, begin its transition from a socialist to a capitalist economy. Growth was supported by rising exports, growing foreign direct investment (FDI) and expanding domestic consumption.

The global economic crisis, which originated in the US in 2008, led to a contraction of 4.9% in the country’s GDP in 2009. However, the exports market recovered marginally in 2010 with GDP recording a growth of 0.2%. In 2007, Bulgaria joined the European Union (EU), which is expected to stimulate further industry growth and activity due to an influx of funds from the European Commission, alongside investments from Western European companies owing to the growth potential of the country’s various construction markets.

Bulgaria has established itself as an attractive outsourcing and off shoring destination. Bulgaria’s accession to the EU in 2007 further stimulated the expanding outsourcing segment, which possesses advantages over Asia due to highly skilled manpower, cultural proximity and excellent language training.

Within the manufacturing category, most investments were made in the automobile industry. The construction of a factory for automotive parts near Rakovski and a car factory initiated by the Chinese Great Wall Motor Company in Lovech were the most significant investments in the manufacturing plant category in 2009.

To purchase the full report, please click here.

The Brazilian Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016

London, January 17, 2012 – Brazil has not come under military attack in over 50 years, and traditionally favors negotiation over military force to resolve disputes with other countries. The country allocates 41% of its defense budget towards pension payments and is expected to spend only 8% towards arms procurements during the forecast period (2011–2016).

Despite this, Brazil’s defense expenditure has grown faster than the majority of the world’s largest defense budgets, at a CAGR of 20.59% during the review period (2005–2010), and it is expected to register another fast growth rate in the forecast period (2011–2016), at a CAGR of 16.69%. Brazil had the eleventh-largest defense expenditure in the world in 2010 and, due to its strong economic growth amd it is expected to become one of the top ten defense spending nations by 2016 (reference figure 10 below).

Brazil has the highest defense expenditure in Latin America, and contributes 48% of the region’s total defense expenditure. Brazil is historically a peaceful country, with a negligible threat from its neighbors and a history of non-involvement in armed conflict. Despite Brazil’s peaceful stance, it has the eleventh-largest defense expenditure in the world and was one of the fastest growing defense industries in the world. This is mostly due to its protection of natural resources from illegal mining, deforestation and drug trafficking, as well as its high spending on pensions of former military personnel.

As Brazil’s long-term focus is the reduction of its reliance on foreign arms suppliers, it is working towards enhancing its indigenous defense capabilities through technology transfer agreements. Brazil’s defense expenditure is expected to grow during the forecast period (2011–2016) due to Brazil’s aim to become the leading arms exporter in Latin America. Brazil is also expected to spend more on defense over the forecast period due to its current modernization of outdated defense systems, and the country’s desire to protect its natural resources. Due to Brazil’s strong economic growth during the forecast period (2011–2016), it is expected to become one of the top ten defense spending nations by 2016.

The country’s defense procurements are largely focused on the protection of its internal environment and natural resources from illegal mining, deforestation and drug trafficking. The country is vast and geographically diverse and is home to the Amazon River and Amazon Rainforest. It also has large reserves of natural resources, and has recently discovered substantial oil reserves.

The Brazilian Ministry of Defense aims to decrease its dependence on foreign OEMs (original equipment manufacturers) and enhancing its domestic defense capabilities. As such, it prefers to procure defense technology from foreign OEMs, which is then constructed by domestic defense companies. This provides domestic defense firms with technology and equipment which they can integrate into their existing systems. Brazil aims to become a net exporter of defense equipment, and it benefits from low labor costs and large availability of raw materials.

Brazil’s homeland security expenditure and product procurement is expected to increase during the forecast period to improve security for Brazil’s hosting of major international sporting events. Millions of spectators expected to attend the 2014 Football World Cup and 2016 Olympic Games, which will take place in Brazil, and will require additional security. The country has begun discussions with Israeli security companies in order to receive security services and technology in airports and transport systems.

Brazil adopts a competitive bidding approach for both domestic and international acquisitions. In addition to compliance with the defense requirements, a bidder must offer the lowest price with the maximum technology transfer to win a defense contract from the country. Any defense deal worth more than US$5 million has an offset obligation equivalent to 100% of the contract value. The main entry strategy for foreign OEMs is through the direct offset route, which entails the transfer of technology to local companies and the manufacture and assembly of systems in Brazil. However, a number of foreign OEMs have established manufacturing bases in Brazil, in order to capitalize on its low labor costs and availability of raw materials. As such, Brazil is considered to be an export hub for Latin America.

To purchase the full report, please click here.