Synopsis
Product Synopsis
This report is the result of ICD Research / Strategic Defence Intelligence's extensive market and company research covering the Taiwanese defense industry. It provides detailed analysis of both historic and forecast defense industry values including key growth stimulators, analysis of the leading companies in the industry, and key news..
Introduction and Landscape
Why was the report written?
The Taiwanese Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016 offers the reader insights into the market opportunities and entry strategies adopted by foreign original equipment manufacturers (OEMs) to gain market share in the Taiwanese defense industry.
What is the current market landscape and what is changing?
Taiwan is predicted to spend US$61.63 billion on its armed forces during the forecast period as the country looks to enhance the capabilities of its armed forces. Defense expenditure registered a CAGR of 0.65% during the review period and is expected to grow at a CAGR of 7.01% during the forecast period. Military expenditure is likely to be influenced by tensions with China and the acquisition of advanced defense systems during the forecast period, and overall defense expenditure is expected to correspond with the country's overall economic growth.
What are the key drivers behind recent market changes?
Taiwanese defense expenditure was primarily driven by factors such as a strained relationship with China and the acquisition of military hardware systems isanticipated to drive the country's military spending over the next five years. Rapid defense modernization plans being pursued by China have also pressurized the Taiwanese Ministry of Defense into increase its military budget.
What makes this report unique and essential to read?
The Taiwanese Defense Industry Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016 provides detailed analysis of the current industry size and growth expectations from 2012 to 2016, including highlights of key growth stimulators. It also benchmarks the industry against key global markets and provides a detailed understanding of emerging opportunities in specific areas.
Key Features and Benefits
The report provides detailed analysis of the current industry size and growth expectations from 2012 to 2016, including highlights of key growth stimulators. It also benchmarks the industry against key global markets and provides detailed understanding of emerging opportunities in specific areas.
The report includes trend analysis of imports and exports, together with theirimplications and impact on the Taiwanese defense industry.
The report covers five forces analysis to identify various power centers in the industry and how these are forecast to develop in the future.
The report allows readers to identify possible ways to enter the market, together with detailed descriptions of how existing companies have entered the market including key contracts, alliances and strategic initiatives.
The report helps the reader to understand the competitive landscape of the defense industry in Taiwan. It provides an overview of key defense companies, together with insights such as key alliances, strategic initiatives and a brief financial analysis.
Key Market Issues
The growth of the Taiwanese defense industry is hampered by project delays associated with the global financial crisis, which have led to cost overruns and the cancellation of certain projects. Despite seeking to increase its defense budget to 3.0% of GDP, the country's 2011 defense budget is estimated at just 2.0% of GDP, primarily due to the financial constraints faced by the country. As a result, certain acquisition programs have either been postponed or cancelled. All these factors discourage investors from entering the Taiwanese defense market.
According to existing regulations, domestically manufactured equipment can be sold in the international arms market, through either government-appointed or designated sales agents that participate in competitive bids or negotiate contracts through private arms dealers. However, a lack of sales agents makes it difficult for the country to cater to the global arms market. The country also established arms trading firm Taiwan Goal to promote domestic arms production, but it was dissolved when it was discovered that the country was involved in malpractice. A lack of exports restricts the growth of the domestic military industrial base.
Excessive corruption within the government's procurement process hampers the entry of foreign investors into the country's defense market. Some foreign investors have resorted to paying bribes in order to win a contract, which has discouraged foreign OEMs from entering the market. For example, in 1991 the French state-owned firm Elf Aquitaine was accused of paying bribes to Taiwanese government officials to win a contract for the sale of six Lafayette Class frigates.
Key Highlights
Taiwan's defense budget, estimated to be US$10.72 billion in 2012, has grown at a CAGR of 0.65% during the review period and is projected to grow at a CAGR of 7.01% during the forecast period, to reach US$14.05 billion by 2016. The country'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.
The country's homeland security spending recorded a CAGR of 9.81% during the review period, and is expected to witness a CAGR of 7.01% during the forecast period. Cumulatively, Taiwan is expected to spend US$35.82 billion on its internal security over the forecast period. During the year 2012 the expenditure was US$ 6.23 billion, which is expected to increase to US$ 8.17 billion by 2016.The nation's homeland security budget is driven by an increase in human trafficking, the illicit drug trade, and maritime security threats.
Taiwan's domestic defense capabilities are relatively underdeveloped, as a result of which the country relies on foreign OEMs to fulfill its military requirements. At present, the Taiwanese military industry is capable of developing military aircraft, small arms, and ammunitions; the state-owned Aerospace Industry Development Corporation (AIDC) developed several aircraft for the Taiwanese Air Force during 1994-2000, but has not done so since. One of the most developed sectors of the country's military industry is the development of missile defense systems, and the government-owned Chung Shan Institute for Science and Technology (CSIST) has developed a range of anti-ship, air-to-air, and surface-to-air missiles over the past three decades.
Table of Contents
1 Introduction
1.1. What is this Report About?
1.2. Definitions
1.3. Summary Methodology
1.4. SDI Terrorism Index
1.5. About Strategic Defence Intelligence (www.strategicdefenceintelligence.com)
2 Executive Summary
3 Market Attractiveness and Emerging Opportunities
3.1. Defense Market Size Historical and Forecast
3.1.1. Defense expenditure projected to grow at a CAGR of XX% during the forecast period
3.1.2. Strained relations with China and acquisition of advanced defense systems to drive military spending
3.1.3. Military expenditure as a percentage of GDP expected to decrease over the forecast period
3.2. Analysis of Defense Budget Allocation
3.2.1. Share of capital expenditure in the overall defense budget expected to decrease
3.2.2. Taiwan's capital expenditure expected to grow at a CAGR of XX% during the forecast period
3.2.3. Taiwan expected to spend US$XX billion on revenue expenses over the forecast period
3.2.4. Defense expenditure likely to correspond with national economic growth
3.3. Homeland Security Market Size and Forecast
3.3.1. Human trafficking, drugs trade and maritime security to drive homeland security spending
3.3.2. Taiwan faces minimal threat from foreign terrorist organizations
3.4. Benchmarking with Key Global Markets
3.4.1. Taiwanese defense expenditure expected to remain modest compared to leading spenders
3.4.2. The country will continue to be a small player in the global arms market
3.4.3. Taiwan's defense expenditure as a percentage of GDP higher than some leading defense spenders
3.4.4. Taiwan has a moderate per-capita defense expenditure
3.4.5. Taiwan faces negligible threat from foreign terrorist organizations
3.5. Market Opportunities: Key Trends and Growth Stimulators
3.5.1. Missile defense systems will witness a surge in demand
3.5.2. Demand for aircraft expected to increase
3.5.3. The country is expected to invest in attack helicopters
3.5.4. Investment in naval defense systems is anticipated to increase
3.5.5. Demand for navy corvette is expected to increase during the forecast period
4 Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Limited domestic defense capabilities drives the country's defense imports
4.1.2. Defense imports are expected to increase during the forecast period
4.1.3. The Germany is a significant defense trade partner of the country
4.1.4. Engines accounted for the majority of defense imports during the review period
4.2. Export Market Dynamics
4.2.1. The country has been unable to access the global defense market
5 Industry Dynamics
5.1. Five Forces Analysis
5.1.1. Bargaining power of supplier: low to high
5.1.2. Bargaining power of buyer: medium
5.1.3. Barrier to entry: medium
5.1.4. Intensity of rivalry: medium
5.1.5. Threat of substitution: medium
6 Market Entry Strategy
6.1. Market Regulation
6.1.1. Government encourages offsets to develop the domestic defense industrial base
6.2. Market Entry Route
6.2.1. Foreign equipment manufacturers enter the market through direct commercial sales
6.2.2. Foreign OEMs enter the market by partnering with a domestic defense firm
6.2.3. Biennial defense exhibition provides an attractive entry route
6.3. Key Challenges
6.3.1. Defense budget cuts lead to cancellation and project delays
6.3.2. Lack of sales agents and stringent regulations restrict domestic defense industry growth
6.3.3. Corruption and lack of transparency impedes the growth of Taiwan's defense industry
7 Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.2. Key Domestic Companies
7.2.1. Aerospace Industrial Development Corporation (AIDC): overview
7.2.2. Aerospace Investment Industrial Development Corporation (AIDC): products
7.2.3. Aerospace Industrial Development Corporation (AIDC): recent announcements and strategic initiatives
7.2.4. Aerospace Industrial Development Corporation (AIDC): alliances
7.2.5. Aerospace Industrial Development Corporation (AIDC): recent contract awards
7.2.6. Chung-Shan Institute of Science and Technology (CSIST): overview
7.2.7. Chung-Shan Institute of Science and Technology (CSIST): products
7.2.8. Chung-Shan Institute of Science and Technology (CSIST): recent announcements and strategic initiatives
7.2.9. Chung-Shan Institute of Science and Technology (CSIST): alliances
7.2.10. China Shipbuilding Corporation (CSBC), Taiwan: overview
7.2.11. China Shipbuilding Corporation (CSBC), Taiwan: products
7.2.12. China Shipbuilding Corporation (CSBC), Taiwan: alliances
7.2.13. The Combined Service Forces (CSF): overview
7.2.14. The Combined Service Forces (CSF): products
7.2.15. The Combined Service Forces (CSF): alliances
8 Business Environment and Country Risk
8.1. Demographics & Social Statistics
8.1.1. Population - Female
8.1.2. Population - Male
8.2. Energy and Utilities
8.2.1. Crude Oil Distillation Capacity
8.2.2. Electricity Installed Capacity
8.2.3. Fossil Fuels Proved natural gas reserves
8.2.4. Fossil Fuels- Proved oil reserves
8.2.5. Hydroelectricity Installed Capacity
8.2.6. Natural Gas Consumption
8.2.7. Natural Gas Imports
8.2.8. Natural Gas Production
8.2.9. Net Conventional Thermal Electricity Generation
8.2.10. Net Geothermal, Solar, Wind, and Wood Electric Power Generation
8.2.11. Net Hydroelectric Power Generation
8.2.12. Nuclear Electricity Net Generation
8.2.13. Petroleum, Consumption
8.2.14. Petroleum, Production
8.3. Minerals
8.3.1. Coal Consumption
8.4. Social & Political Risk
8.4.1. Transparency Index
8.5. Technology
8.5.1. Patents Granted
8.5.2. Software Patents
9 Appendix
9.1. Contact Us
9.2. About SDI
9.3. Disclaimer
List of Tables
- Table 1: Taiwanese Defense Expenditure, 2007-2011
- Table 2: Taiwanese Defense Expenditure, 2012-2016
- Table 3: Taiwanese Defense Expenditure as a Percentage of GDP (%), 2007-2011
- Table 4: Taiwanese Defense Expenditure as a Percentage of GDP (%), 2012-2016
- Table 5: Taiwanese Defense Budget Split Between Capital and Revenue Expenditure (%), 2007-2011
- Table 6: Taiwanese Defense Budget Split Between Capital and Revenue Expenditure (%), 2012-2016
- Table 7: Taiwanese Capital Budget Allocation (US$ billion), 2007-2011
- Table 8: Taiwanese Capital Budget Allocation (US$ billion), 2012-2016
- Table 9: Taiwanese Revenue Budget Allocation (US$ billion), 2007-2011
- Table 10: Taiwanese Revenue Budget Allocation (US$ billion), 2012-2016
- Table 11: Taiwanese GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2007-2011
- Table 12: Taiwanese GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2012-2016
- Table 13: Taiwanese Homeland Security Budget (US$ billion), 2007-2011
- Table 14: Taiwanese Homeland Security Budget (US$ billion), 2012-2016
- Table 15: SDI Terrorism Heat Map, 2011
- Table 16: Benchmarking with Key Markets - 2007-2011 vs. 2012-2016
- Table 17: SDI Terrorism Index
- Table 18: Defense Offset Regulations in Taiwan
- Table 19: Taiwan Aerospace Industrial Development Corporation (AIDC)-Product Focus
- Table 20: Aerospace Industrial Development Corporation (AIDC) - Alliances
- Table 21: Taiwan Aerospace Industrial Development Corporation (AIDC) - Recent Contract Wins
- Table 22: Taiwan Chung-Shan Institute of Science and Technology (CSIST)-Product Focus
- Table 23: Chung-Shan Institute of Science and Technology (CSIST) - Alliances
- Table 24: Taiwan Chung-Shan Institute of Science and Technology (CSIST)-Product Focus
- Table 25: China Shipbuilding Corporation (CSBC), Taiwan - Alliances
- Table 26: Taiwan Chung-Shan Institute of Science and Technology (CSIST)-Product Focus
- Table 27: The Combined Service Forces (CSF) - Alliances
List of Figures
- Figure 1: Taiwanese Defense Expenditure, 2007-2011
- Figure 2: Taiwanese Defense Expenditure, 2012-2016
- Figure 3: Taiwanese Defense Expenditure as a Percentage of GDP (%), 2007-2011
- Figure 4: Taiwanese Defense Expenditure as a Percentage of GDP (%), 2012-2016
- Figure 5: Taiwanese Defense Budget Split Between Capital and Revenue Expenditure (%), 2007-2011
- Figure 6: Taiwanese Defense Budget Split Between Capital and Revenue Expenditure (%), 2012-2016
- Figure 7: Taiwanese Capital Budget Allocation (US$ billion), 2007-2011
- Figure 8: Taiwanese Capital Budget Allocation (US$ billion), 2012-2016
- Figure 9: Taiwanese Revenue Budget Allocation (US$ billion), 2007-2011
- Figure 10: Taiwanese Revenue Budget Allocation (US$ billion), 2012-2016
- Figure 11: Taiwanese GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2007-2011
- Figure 12: Taiwanese GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2012-2016
- Figure 13: Taiwanese Homeland Security Budget (US$ billion), 2007-2011
- Figure 14: Taiwanese Homeland Security Budget (US$ billion), 2012-2016
- Figure 15: SDI Terrorism Index, 2011
- Figure 16: Benchmarking with Key Markets - 2007-2011 vs. 2012-2016
- Figure 17: Defense Expenditure of the World's Largest Military Spenders (US$ Billion), 2011 and 2016
- Figure 18: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2011
- Figure 19: Per-capita Defense Expenditure of the Largest Military Spenders in the World (US$), 2011
- Figure 20: Taiwanese Defense Import Trend, 2007-2011 (TIV values)
- Figure 21: Taiwanese Defense Imports by Country (%), 2007-2011
- Figure 22: Taiwanese Defense Imports by Category (%), 2007-2011
- Figure 23: Industry Dynamics Porter's Five Forces Analysis
- Figure 24: Taiwanese Population - Female (In Millions), 2008-2017
- Figure 25: Taiwanese Population - Male (In Millions), 2008-2017
- Figure 26: Taiwanese Crude Oil Distillation Capacity (Thousand Barrels Per Cal Day), 2000-2009
- Figure 27: Taiwanese Electricity Installed Capacity (Million Kilowatts), 2000-2009
- Figure 28: Taiwanese Fossil Fuels Proved natural gas reserves (Trillion Cubic Feet), 2002-2011
- Figure 29: Taiwanese Fossil Fuels Proved natural oil reserves (Billion Barrels), 2002-2011
- Figure 30: Taiwanese Hydroelectricity Installed Capacity (Million Kilowatts), 2000-2009
- Figure 31: Taiwanese Natural Gas Consumption (Billion Cubic Feet), 2001-2010
- Figure 32: Taiwanese Natural Gas Imports (Billion Cubic Feet), 2001-2010
- Figure 33: Taiwanese Natural Gas Production (Billion Cubic Feet), 2001-2010
- Figure 34: Taiwanese Net Conventional Thermal Electricity Generation (Billion Kilowatt hours), 2001-2010
- Figure 35: Taiwanese Net Geothermal, Solar, Wind, and Wood Electric Power Generation (Billion Kilowatt hours), 2001-2010
- Figure 36: Taiwanese Net Hydroelectric Power Generation (Billion Kilowatt hours), 2001-2009
- Figure 37: Taiwanese Nuclear Electricity Net Generation (Billion Kilowatt hours), 2001-2010
- Figure 38: Taiwanese Petroleum Consumption (Thousand Barrels Per Day), 2002-2011
- Figure 39: Taiwanese Petroleum Production (Thousand Barrels Per Day), 2002-2011
- Figure 40: Taiwanese Coal Consumption (Thousand Short Tons), 2001-2010
- Figure 41: Taiwanese Transparency Index, 2002-2011
- Figure 42: Taiwanese Patents Granted, 2002-2011
- Figure 43: Taiwanese Software Patents, 2002-2011
The Taiwanese Defense Industry: Market Opportunities and Entry Strategies, Analyses and Forecasts to 2016 published by ICD Research in June 28, 2012. This report consists of Pages: 79 and the price starts from US $ 1250.
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