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Market Research Report

Future of the UAE Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

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Future of the UAE Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023
Published: November 26, 2018 Content info: 144 Pages
Description

"Future of the UAE Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023", published by GlobalData, provides readers with detailed analysis of both historic and forecast defense industry values, factors influencing demand, the challenges faced by industry participants, analysis of industry leading companies, and key news.

This report offers detailed analysis of the UAE defense industry with market size forecasts covering the next five years. This report will also analyze factors that influence demand for the industry, key market trends, and challenges faced by industry participants.

In particular, it provides an in-depth analysis of the following -

  • The UAE defense industry market size and drivers: detailed analysis of the UAE defense industry during 2019-2023, including highlights of the demand drivers and growth stimulators for the industry. It also provides a snapshot of the country's expenditure and modernization patterns
  • Budget allocation and key challenges: insights into procurement schedules formulated within the country and a breakdown of the defense budget with respect to capital expenditure and revenue expenditure. It also details the key challenges faced by defense market participants within the country
  • Import and Export Dynamics: analysis of prevalent trends in the country's imports and exports over the last five years
  • Market opportunities: list of the top ten defense investment opportunities over the next 5 years
  • Competitive landscape and strategic insights: analysis of the competitive landscape of the UAE defense industry.

Scope

  • UAE defense expenditure stands at US$10.7 billion in 2018, and registered a compound annual growth rate (CAGR) of -5.94% during the historic period.
  • The country's strained relationship with Greece, persistent threats from the Kurdish Workers Party (PKK), active participation in peacekeeping missions, and the reduction in foreign dependency for military equipment procurement, drove defense expenditure during the historic period.
  • With this trend expected to continue, expenditure is anticipated to register a CAGR of 8.36% over the forecast period to value US$15.8 billion in 2023.
  • As a percentage of GDP, the country's defense expenditure will average 1.36% over the forecast period, which is marginally declining compared to an average of 1.44% recorded during the historic period.

Reasons to buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of the UAE defense industry market trends for the coming five years
  • The market opportunity section will inform the user about the various military requirements that are expected to generate revenues during the forecast period. The description includes technical specifications, recent orders, and the expected investment pattern by the country during the forecast period
  • Profiles of the top domestic and foreign defense manufacturers . This will provide the user with a total competitive landscape of the sector
  • A deep qualitative analysis of the UAE defense industry covering sections including demand drivers, Key Trends , and latest industry contracts.
Table of Contents
Product Code: GDDF0534MR

Table of Contents

1. Introduction 9

  • 1.1. What is this Report About? 9
  • 1.2. Definitions 9
  • 1.3. Summary Methodology 11
  • 1.4. About GlobalData 12

2. Executive Summary 13

3. Market Attractiveness and Emerging Opportunities 15

  • 3.1. Current Market Scenario 16
    • 3.1.1. Primary Threat Perception 16
    • 3.1.2. Military Doctrine and Strategy 17
    • 3.1.3. Military Fleet Size 19
    • 3.1.4. Procurement Programs 23
    • 3.1.5. Social, Political and Economic Environment and Support for Defense Projects 27
    • 3.1.6. Political and Strategic Alliances 28
  • 3.2. Defense Market Size Historical and Forecast 30
    • 3.2.1. UAE defense budget to record a CAGR of 6.47% over the forecast period 30
    • 3.2.2. Military modernization initiatives, territorial dispute with Iran, and peace keeping missions to drive defense expenditure 33
    • 3.2.3. The defense budget as a percentage of GDP is expected to increase over the forecast period 35
  • 3.3. Analysis of Defense Budget Allocation 37
    • 3.3.1. Procurement of advanced equipment to drive capital expenditure allocation over the forecast period 37
    • 3.3.2. Capital expenditure is expected to grow at a CAGR of 7.39% over the forecast period 39
    • 3.3.3. Per capita defense expenditure expected to increase over the forecast period 41
  • 3.4. Homeland Security Market Size and Forecast 43
    • 3.4.1. The UAE's homeland security budget is expected to increase at a CAGR of 4.66% over the forecast period 43
    • 3.4.2. Investment in the protection of infrastructure and cyber security are expected to drive the UAE homeland security market 45
    • 3.4.3. The UAE falls under the "some risk" category on the Terrorism Index 46
    • 3.4.4. The UAE faces "some risk" by acts of terrorism 47
    • 3.4.5. The UAE has a terrorism index score of 0.2 49
  • 3.5. Benchmarking with Key Global Markets 50
    • 3.5.1. The UAE's defense budget is expected to register rapid growth over 2019-2023 50
    • 3.5.2. The UAE's defense expenditure is relatively small when compared to the leading defense spenders 52
    • 3.5.3. The UAE spent over 6.1% of its GDP on defense in 2018 53
  • 3.6. Market Opportunities: Key Trends and Drivers 54
    • 3.6.1. Top 10 Defense Sectors by Value (US$ Million) - Projections over 2018-2023 54
    • 3.6.2. Critical Infrastructure Protection - Physical Security 55
    • 3.6.3. Land-Based C4ISR 56
    • 3.6.4. Multirole Aircraft 57

4. Defense Procurement Market Dynamics 58

  • 4.1. Import Market Dynamics 59
    • 4.1.1. Limitations within the domestic defense industry to encourage arms imports 59
    • 4.1.2. The UAE was the world's fourth-largest arms importer over the historic period 60
    • 4.1.3. The US continues to be the major arms supplier to the UAE 61
    • 4.1.4. Missiles and ships dominate UAE defense imports 62
  • 4.2. Export Market Dynamics 63
    • 4.2.1. The UAE has minimal defense exports 63

5. Industry Dynamics 66

  • 5.1. Five Forces Analysis 66
    • 5.1.1. Bargaining Power of Supplier: Low to Medium 67
    • 5.1.2. Bargaining Power of Buyer: Medium to High 67
    • 5.1.3. Barrier to Entry: Medium to High 67
    • 5.1.4. Intensity of Rivalry: High 68
    • 5.1.5. Threat of Substitution: Low to Medium 68

6. Market Entry Strategy 69

  • 6.1. Market Regulation 69
    • 6.1.1. Defense deals are settled through direct negotiation or competitive bidding 69
    • 6.1.2. Foreign OEMs prefer indirect offsets to meet the obligations associated with defense deals 69
  • 6.2. Market Entry Route 71
    • 6.2.1. Budget Process 71
    • 6.2.2. Procurement Policy and Process 72
    • 6.2.3. Foreign OEMs use proxy representatives to enter the market 72
    • 6.2.4. Defense exhibitions hosted by the UAE serve as an entry route for foreign OEMs 73
    • 6.2.5. Joint ventures and collaborations offer alternative means of entering the market 73
  • 6.3. Key Challenges 74
    • 6.3.1. Complying with the UAE's stringent offset requirements a concern for OEMs 74
    • 6.3.2. The UAE demands technology transfers in its defense deals 74

7. Competitive Landscape and Strategic Insights 75

  • 7.1. Competitive Landscape Overview 75
  • 7.2. Key Domestic Public Sector Companies 78
    • 7.2.1. Abu Dhabi Ship Building: Overview 78
    • 7.2.2. Abu Dhabi Ship Building: Products and Services 78
    • 7.2.3. Abu Dhabi Ship Building (ADSB): Recent Announcements and Strategic Initiatives 78
    • 7.2.4. Abu Dhabi Ship Building: Alliances 79
    • 7.2.5. Abu Dhabi Ship Building: Recent Contract Wins 80
    • 7.2.6. Abu Dhabi Ship Building: Financial Analysis 81
    • 7.2.7. Gulf Logistics and Naval Support: Overview 83
    • 7.2.8. Gulf Logistics and Naval Support: Services 83
    • 7.2.9. Abu Dhabi Systems Integration: Overview 85
    • 7.2.10. Abu Dhabi Systems Integration: Products and Services 85
    • 7.2.11. Abu Dhabi Systems Integration: Recent Announcements and Strategic Initiatives 85
    • 7.2.12. Abu Dhabi Systems Integration: Alliances 85
  • 7.3. Key Foreign Companies 87
    • 7.3.1. Lockheed Martin: Overview 87
    • 7.3.2. Lockheed Martin: Products 87
    • 7.3.3. Lockheed Martin: Recent Announcements and Strategic Initiatives 87
    • 7.3.4. Lockheed Martin: Alliances 89
    • 7.3.5. Lockheed Martin: Recent Contract Wins 90
    • 7.3.6. Lockheed Martin: Financial Analysis 92
    • 7.3.7. BAE Systems Plc.: Overview 94
    • 7.3.8. BAE Systems Plc.: Products 94
    • 7.3.9. BAE Systems Plc.: Recent Announcements and Strategic Initiatives 95
    • 7.3.10. BAE Systems Plc.: Alliances 96
    • 7.3.11. BAE Systems Plc. - recent contract wins 97
    • 7.3.12. BAE Systems: Financial Analysis 99
    • 7.3.13. Raytheon: Overview 101
    • 7.3.14. Raytheon: Products 101
    • 7.3.15. Raytheon: Recent Announcements and Strategic Initiatives 101
    • 7.3.16. Raytheon: Alliances 105
    • 7.3.17. Raytheon: Recent Contract Wins 106
    • 7.3.18. Raytheon: Financial Analysis 108
    • 7.3.19. Rolls-Royce Plc.: Overview 110
    • 7.3.20. Rolls-Royce Plc.: Products 110
    • 7.3.21. Rolls-Royce Plc.: Recent Announcements and Strategic Initiatives 110
    • 7.3.22. Rolls-Royce Plc.: Alliances 111
    • 7.3.23. Rolls-Royce Plc.: Recent Contract Wins 112
    • 7.3.24. Rolls-Royce Plc.: Financial Analysis 113
    • 7.3.25. Northrop Grumman Corporation: Overview 115
    • 7.3.26. Northrop Grumman Corporation: Products 115
    • 7.3.27. Northrop Grumman Corporation: Recent Announcements and Strategic initiatives 115
    • 7.3.28. Northrop Grumman Corporation: Alliances 117
    • 7.3.29. Northrop Grumman Corp.: Recent Contract Wins 119
    • 7.3.30. Northrop Grumman: Financial Analysis 121
    • 7.3.31. Thales: Overview 123
    • 7.3.32. Thales: Products 123
    • 7.3.33. Thales: Recent Announcements and Strategic Initiatives 123
    • 7.3.34. Thales: Alliances 124
    • 7.3.35. Thales: Recent Contract Wins 125
    • 7.3.36. Thales: Financial Analysis 126
    • 7.3.37. The Boeing Company: Overview 128
    • 7.3.38. The Boeing Company: Products 128
    • 7.3.39. The Boeing Company: Recent Announcements and Strategic Initiatives 128
    • 7.3.40. The Boeing Company: Alliances 130
    • 7.3.41. The Boeing Company: Recent Contract Wins 130
    • 7.3.42. The Boeing Company: Financial Analysis 132

8. Business Environment and Country Risk 134

  • 8.1. Economic Performance 134
    • 8.1.1. GDP per Capita 134
    • 8.1.2. Gross Domestic Product 135
    • 8.1.3. Exports of Goods and Services (LCU Billion) 136
    • 8.1.4. Imports of Goods and Services (LCU Billion) 137
    • 8.1.5. LCU per US$ (Period Average) 138
    • 8.1.6. Market Capitalization of Listed Companies 139
    • 8.1.7. Market Capitalization of Listed Companies as a Percentage GDP 140
    • 8.1.8. Foreign Direct Investment, net (BoP, Current US$ Billion) 141
    • 8.1.9. Net Foreign Direct Investment as a Percentage of GDP 142
    • 8.1.10. Mining, Manufacturing, Utilities Output (LCU Billion) 143

9. Appendix 144

  • 9.1. About GlobalData 144
  • 9.2. Disclaimer 144

List of Tables

  • Table 1: UAE Army Strength 19
  • Table 2: UAE Air Force Strength 21
  • Table 3: UAE Navy Strength 22
  • Table 4: UAE - Ongoing Development and Procurement Programs 23
  • Table 5: UAE - Future Procurement Programs 25
  • Table 6: The UAE Top Defense Procurement Programs by Value (US$ Million), 2018-2023 26
  • Table 7: UAE Defense Expenditure (AED Billion & US$ Billion), 2014-2023 31
  • Table 8: UAE GDP Growth and Defense Expenditure as a Percentage of GDP Growth (%), 2014-2023 35
  • Table 9: UAE Defense Budget Split Between Capital and Revenue Expenditure (%), 2014-2023 37
  • Table 10: UAE Defense Capital Expenditure (AED Billion & US$ Billion), 2014-2023 39
  • Table 11: UAE Per Capita Expenditure (US$), 2014-2023 41
  • Table 12: UAE Defense Expenditure for Homeland Security (AED Billion & US$ Billion), 2014-2023 43
  • Table 13: Terrorism Index, 2017 47
  • Table 14: Benchmarking with Key Markets, 2014-2018 vs 2019-2023 50
  • Table 15: Top Israeli Defense Sectors by Value (US$ Million), 2018-2023 54
  • Table 16: UAE - Offset Guidelines and Agreements 70
  • Table 17: UAE Budget Formation Timetable 71
  • Table 18: Competitive Landscape of the UAE Defense Industry 75
  • Table 19: Top Defense Suppliers in the UAE Defense Industry By Value (US$ Million) 2018-2023 77
  • Table 20: Abu Dhabi Ship Building - Products and Services 78
  • Table 21: Abu Dhabi Ship Building - Alliances 79
  • Table 22: Abu Dhabi Ship Building - Recent Contract Wins 80
  • Table 23: Gulf Logistics and Naval Support - Services 83
  • Table 24: Abu Dhabi Systems Integration - Products and Services 85
  • Table 25: Abu Dhabi Systems Integration - Alliances 86
  • Table 26: Lockheed Martin - Products 87
  • Table 27: Lockheed Martin - Alliances 89
  • Table 28: Lockheed Martin - Recent Contract Wins 90
  • Table 29: BAE Systems Plc. - Major Products 94
  • Table 30: BAE Systems Plc. - Alliances 96
  • Table 31: BAE Systems Plc. - recent contract wins 97
  • Table 32: Raytheon - Products 101
  • Table 33: Raytheon - Alliances 105
  • Table 34: Raytheon Company - Recent Contract Wins 106
  • Table 35: Rolls-Royce Plc. - Products 110
  • Table 36: Rolls-Royce Plc. - Alliances 111
  • Table 37: Rolls-Royce Plc. - Recent Contract Wins 112
  • Table 38: Northrop Grumman - Products 115
  • Table 39: Northrop Grumman Corporation - Alliances 117
  • Table 40: Northrop Grumman Corp. - Recent Contract Wins 119
  • Table 41: Thales - Products 123
  • Table 42: Thales - Alliances 124
  • Table 43: Thales - Recent Contract Wins 125
  • Table 44: The Boeing Company - Products 128
  • Table 45: The Boeing Company - Alliances 130
  • Table 46: The Boeing Company - Recent Contract Wins 130

List of Figures

  • Figure 1: UAE Defense Expenditure (in AED Billion), 2014-2023 31
  • Figure 2: UAE Defense Expenditure (US$ Billion), 2014-2023 32
  • Figure 3: UAE GDP Growth vs Defense Expenditure Growth and Defense Expenditure as a Percentage of GDP (%), 2014-2023 36
  • Figure 4: UAE Defense Expenditure Split Between Capital and Revenue Expenditure (%), 2014-2023 38
  • Figure 5: UAE Defense Capital Expenditure (AED Billion), 2014-2023 40
  • Figure 6: UAE Defense Capital Expenditure (US$ Billion), 2014-2023 40
  • Figure 7: UAE Per Capita Expenditure (US$), 2014-2023 42
  • Figure 8: UAE Homeland Security Expenditure (AED Billion), 2014-2023 44
  • Figure 9: UAE Homeland Security Expenditure (US$ Billion), 2014-2023 44
  • Figure 10: Terrorism Heat Map, 2018 46
  • Figure 11: Terrorism Index, 2018 49
  • Figure 12: Benchmarking with Key Markets, 2014-2018 vs 2019-2023 51
  • Figure 13: Defense Expenditure of the World's Largest Military Spenders (US$ Billion), 2018 and 2023 52
  • Figure 14: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2018 53
  • Figure 15: Physical Security Market Size (US$ Million), 2018-2023 55
  • Figure 16: Land Based C4ISR Market Size (US$ Million), 2018-2023 56
  • Figure 17: Multirole Aircraft (US$ Million), 2018-2023 57
  • Figure 18: The UAE's Top Defense Procurements in Terms of Their Supplier Relationships 58
  • Figure 19: UAE Defense Imports (US$ million), 2013-2017 60
  • Figure 20: UAE Defense Imports by Country (%), 2013-2017 61
  • Figure 21: UAE Defense Imports by Category (%), 2013-2017 62
  • Figure 22: UAE Defense Exports (US$ million), 2013-2017 63
  • Figure 23: UAE Defense Exports by Country (%), 2013-2017 64
  • Figure 24: UAE Defense Exports by Category (%), 2013-2017 65
  • Figure 25: Industry Dynamics Porter's Five Forces Analysis 66
  • Figure 26: Abu Dhabi Ship Building - Revenue Trend Analysis (AED Million), 2013-2017 81
  • Figure 27: Abu Dhabi Ship Building - Operating Profit Trend Analysis (AED Million), 2012-2016 81
  • Figure 28: Abu Dhabi Ship Building - Net Profit Trend Analysis (AED Million), 2013-2017 82
  • Figure 29: Lockheed Martin - Revenue Trend Analysis (US$ Billion), 2013-2017 92
  • Figure 30: Lockheed Martin - Operating Profit Trend Analysis (US$ Billion), 2013-2017 93
  • Figure 31: Lockheed Martin - Net Profit Trend Analysis (US$ Billion), 2013-2017 93
  • Figure 32: BAE Systems - Revenue Trend Analysis (GBP Billion), 2013-2017 99
  • Figure 33: BAE Systems - Operating Profit Trend Analysis (GBP Billion), 2013-2017 100
  • Figure 34: BAE Systems - Net Profit Trend Analysis (GBP Billion), 2013-2017 100
  • Figure 35: Raytheon - Revenue Trend Analysis (US$ Billion), 2013-2017 108
  • Figure 36: Raytheon - Operating Profit Trend Analysis (US$ Billion), 2013-2017 109
  • Figure 37: Raytheon - Net Profit Trend Analysis (US$ Billion), 2013-2017 109
  • Figure 38: Rolls-Royce Plc. - Revenue Trend Analysis (GBP Billion), 2013-2017 113
  • Figure 39: Rolls-Royce Plc. - Operating Profit Trend Analysis (GBP Million), 2013-2017 114
  • Figure 40: Rolls-Royce Plc. - Net Profit Trend Analysis (GBP Million), 2013-2017 114
  • Figure 41: Northrop Grumman - Revenue Trend Analysis (US$ Billion), 2013-2017 121
  • Figure 42: Northrop Grumman - Operating Profit Trend Analysis (US$ Billion), 2013-2017 121
  • Figure 43: Northrop Grumman - Net Profit Trend Analysis (US$ Billion), 2013-2017 122
  • Figure 44: Thales - Revenue Trend Analysis (EUR Billion), 2013-2017 126
  • Figure 45: Thales - Operating Profit Trend Analysis (EUR Million), 2013-2017 126
  • Figure 46: Thales - Net Profit Trend Analysis (EUR Million), 2013-2017 127
  • Figure 47: Boeing - Revenue Trend Analysis (US$ Billion), 2013-2017 132
  • Figure 48: Boeing - Operating Profit Trend Analysis (US$ Billion), 2013-2017 132
  • Figure 49: Boeing - Net Profit Trend Analysis (US$ Billion), 2013-2017 133
  • Figure 50: UAE GDP Per Capita (US$), 2015-2025 134
  • Figure 51: UAE GDP at Current Prices (US$ Billion), 2015-2025 135
  • Figure 52: UAE Exports of Goods and Services (LCU Billion), 2005-2014 136
  • Figure 53: UAE Imports of Goods and Services (LCU Billion), 2005-2014 137
  • Figure 54: LCU per US$ (US$), 2015-2024 138
  • Figure 55: UAE Market Capitalization of Listed Companies (US$ Billion), 2005-2012 139
  • Figure 56: UAE Market Capitalization of Listed Companies (% of GDP), 2005-2012 140
  • Figure 57: UAE Net Foreign Direct Investment (BoP, Current US$ Billion) 2005-2014 141
  • Figure 58: UAE Net Foreign Direct Investment as a Percentage of GDP, 2005-2014 142
  • Figure 59: UAE Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014 143
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