Over the past decade, ASEAN countries have seen an upward trend in defense expenditure, with significant investment in aircraft, engines, radar and weapons, and force modernization. Apprehensions about Chinese intentions in the South China Sea have led to growing interest in monitoring and protecting Exclusive Economic Zones and fishing areas, while fear of Islamic State of Iraq and Syria (ISIS)-related attacks, and the desire to combat piracy, smuggling, and drug trafficking, has led to a ramping of spending on military hardware.
According to SIPRI, the largest military spenders in absolute terms in 2016, were Singapore (USD 10 billion) and Indonesia (USD 8.2 billion), followed by Thailand and Vietnam (about USD 5-6 billion), and Malaysia and Philippines (around USD 4 billion). While these numbers cannot compare with the world’s top 10 military spenders (the US, China, Russia, Saudi Arabia, India, major EU economies, Japan and South Korea), the fact that ASEAN defense imports increased by 71% between 2009 and 2016 cannot be ignored.
IHS Jane forecasts that Indonesia and Vietnam will be two of the top five global import opportunities over the coming decade. Indonesia, in particular, is poised to transform into a great economic power. Its economy, which is valued at USD 941 billion, is the tenth largest in the world, and is forecasted to grow by 5.5% in 2017, making it potentially the largest defense spender in South East Asia.
Prominent companies with bases in the region include Honeywell, Airbus, GE, Pratt & Whitney, Boeing, Rolls Royce, Bell Helicopter and Spirit Aerosystems. While countries in the region continue to invest in big-ticket items such as aircraft and submarines, some countries like Indonesia, Thailand and Malaysia are increasingly encouraging domestic defense firms to manufacture hardware locally, and governments are adapting their purchases to help them develop their own defense expertise.
Starting with an overview of the key South East Asian markets, the report goes on to analyze the region’s defense expenditure in relation to each nation's economic standing and competitiveness regionally and globally. It then goes on to provide a roundup of key developments and opportunities by market, and to provide exporters with a general assessment of each market.
Orissa International regularly undertakes market research projects in various sectors in South East Asia for trade promotion agencies and individual companies. With more than 20 years of experience in helping companies with their market entry into South East Asia, our in-country research teams have acquired extensive and practical hands-on industry knowledge.
Research in each country is undertaken by an in-market analyst. Our physical presence in the market gives us an ability to engage directly with local industry contacts, keep track of commercial opportunities in the market, and monitor the latest trends and industry events that impact the market.
We undertake desk research to gather as much secondary data and information from a variety of credible sources. These include our proprietary distributor databases, specialist trade press, business and mainstream press, industry news and events, market studies, financial reports, trade associations, as well as company profiles, publications, and annual reports. Orissa International applies various processes and a series of quality checks to validate data and information to ensure the quality, completeness, and accuracy of our reports.
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