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Market Research Report

Romanian Defense Market - Attractiveness, Competitive Landscape and Forecasts to 2024

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Romanian Defense Market - Attractiveness, Competitive Landscape and Forecasts to 2024
Published: August 30, 2019 Content info: 67 Pages
Description

Romania's defense expenditure is projected to register a CAGR of 0.43% during the forecast period to value US$7.0 billion in 2024. Eomania's military expenditure stands at US$7.8 billion in 2019, registering at CAGR of 43.73% and is projected to register a CAGR of 0.43% over the forecast period. Romania is modernizing its land, air and naval forces through international partnerships to meet NATO standards that mandate an allocation of 2% of GDP for defense until 2026.

Romanian capital expenditure allocation, which stood at an average of US$1.3 billion during the historic period, is projected to increase to an average of US$1.9 billion during 2020-2024. The country's defense expenditure is expected to cumulatively value US$34.2 billion during 2020-2024. The defense budget as a percentage of GDP is expected to increase slightly, from an average of 2.3% during the historic period to 2.6% during 2020-2024. Key opportunities for equipment suppliers are expected in areas such as F-16 multirole aircraft, multirole aircraft MRO, a HIMARS rocket artillery system, a Patriot missile defense system, Piranha V armored vehicles, air defense radars, surface to air missile systems, corvettes, and submarines.

Romania's homeland security (HLS) expenditure stands at US$4.9 billion in 2019 with a CAGR of 18.05% during the historic period, and is projected to stand at US$4.8 billion in 2024 with a CAGR of 2.58% during the forecast period. This expenditure is primarily driven by the country's focus on enhancing its defense capabilities to counter the increasing rate of cyber-attacks, modernize its border control and security infrastructure, and increase efforts by the government to control organized crimes such as drug trafficking.

Although defense imports peaked in 2016, they are expected to remain low over the forecast period. Romania's Air Force acquired F-16 fighters and C-27J aircraft, from Portugal which were the major contributor to the country's imports. Armored vehicles, sensors, engines, and missiles were the other major imports to Romania during 2014-2018. Italy, the US, Switzerland and France were the other significant suppliers to Romania. Romania did not export any arms to foreign countries as its defense industry is largely underdeveloped. However, the country is anticipated to increase its defense exports during the forecast period, primarily in the area of naval vessels and related maintenance, repair, and overhaul (MRO).

The report "Romanian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2024" 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.

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

  • The Romanian defense industry market size and drivers: detailed analysis of the Romanian defense industry during 2020-2024, 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 Romanian defense industry

Companies mentioned: Lockheed Martin, General Dynamics European Land Systems, Iveco, Raytheon Missile Systems, EuroSpike GmbH, BAE Systems

Scope

  • Romania's military expenditure, which stands at US$7.8 billion in 2019, is anticipated to grow from US$6.9 billion in 2020 to value US$7 billion in 2024, registering a CAGR of 0.43% over the forecast period, primarily fueled by the ongoing military modernization plans.
  • Military expenditure, on a cumulative basis, is anticipated to be US$34.2 billion, which is higher than the US$23.5 billion spent during the historic period. Romania is an active participant in joint operations with the European Union (EU) and peacekeeping operations with NATO and the United Nations (UN).
  • The defense budget as a percentage of GDP is expected to increase on an average from 2.3% during 2015-2019 to 2.6% over 2020-2024. The country's per capita defense expenditure is expected to increase from US$404 in 2019 to US$371.5 in 2024.

Reasons to buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Romanian 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.
  • Detailed profiles of the top domestic and foreign defense manufacturers with information about their products, alliances, recent contract wins, and financial analysis wherever available. This will provide the user with a total competitive landscape of the sector.
  • A deep qualitative analysis of the Romanian defense industry covering sections including demand drivers, key trends and latest industry contracts.
Table of Contents
Product Code: GDDF0590MR

Table of Contents

List of Figures

List of Tables

1. Introduction

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

2. Executive Summary

3. Market Attractiveness and Emerging Opportunities

  • 3.1. Current Market Scenario
    • 3.1.1. Procurement Programs
    • 3.1.2. Key Drivers and Challenges
  • 3.2. Defense Market Size Historical and Forecast
    • 3.2.1. Romanian defense expenditure to register a CAGR of 0.43% over the forecast period
    • 3.2.2. The country's modernization efforts to meet NATO standards, and its participation in peacekeeping missions will support defense expenditure
  • 3.3. Analysis of Defense Budget Allocation
    • 3.3.1. Romania's defense expenditure as a percentage of GDP is projected to increase on an average over the forecast period
    • 3.3.2. Capital expenditure allocation expected to increase over the forecast period
    • 3.3.3. Capital expenditure expected to grow at a CAGR of 12.63% over the forecast period
    • 3.3.4. Per capita defense expenditure forecasted to grow over the forecast period
  • 3.4. Homeland Security Market Size and Forecast
    • 3.4.1. Homeland security budget projected to grow steadily over the forecast period
    • 3.4.2. Border control measures and cybercrime to drive homeland security budget
  • 3.5. Benchmarking with Key Global Markets
    • 3.5.1. Romania's defense budget to increase at a CAGR of 0.43% during the forecast period
    • 3.5.2. Romanian defense expenditure is expected to remain low compared to other leading spenders
    • 3.5.3. The country allocates a lower percentage of GDP towards defense compared to other top defense spenders globally
  • 3.6. Market Opportunities: Key Trends and Growth Stimulators
    • 3.6.1. Top Defense Market Sectors by Value (US$ Million) - Projections over 2019-2024

4. Defense Procurement Market Dynamics

  • 4.1. Import Market Dynamics
    • 4.1.1. Defense imports registered an increasing trend during 2014-2018
    • 4.1.2. Romania sourced most of its arms from Portugal
    • 4.1.3. Aircraft and sensors accounted for most of arms imports during 2014-2018
  • 4.2. Export Market Dynamics
    • 4.2.1. Defense exports were negligible during 2014-2018

5. Market Entry Strategy

  • 5.1. Market Regulation
    • 5.1.1. Offset policy mandates that suppliers invest a minimum of 80% of the contract value into the Romanian economy
    • 5.1.2. Romania allows 100% foreign direct investment in the defense sector
  • 5.2. Market Entry Route
    • 5.2.1. Budgeting Process
    • 5.2.2. Procurement Policy and Process
    • 5.2.3. Foreign OEMs enter the market through the acquisition of domestic defense companies
    • 5.2.4. EDA promotes defense procurements within the EU

6. Competitive Landscape and Strategic Insights

  • 6.1. Competitive Landscape Overview

7. Business Environment and Country Risk

  • 7.1. Economic Performance
    • 7.1.1. GDP Per Capita
    • 7.1.2. GDP, Current Prices
    • 7.1.3. Exports of Goods and Services (LCU Billion)
    • 7.1.4. Imports of Goods and Services (LCU Billion)
    • 7.1.5. Gross National Disposable Income (US$ Billion)
    • 7.1.6. Local Currency Unit per US$
    • 7.1.7. Market Capitalization of Listed Companies
    • 7.1.8. Market Capitalization of Listed Companies (% of GDP)
    • 7.1.9. Government Cash Surplus/Deficit as a Percentage of GDP
    • 7.1.10. Goods Exports as a Percentage of GDP
    • 7.1.11. Goods Imports as a Percentage of GDP
    • 7.1.12. Service Imports as a Percentage of GDP
    • 7.1.13. Service Exports as a Percentage of GDP
    • 7.1.14. Net Foreign Direct Investment (US$ Billion)
    • 7.1.15. Net Foreign Direct Investment as a Percentage of GDP
    • 7.1.16. Mining, Manufacturing, Utilities Output

8. Appendix

  • 8.1. About GlobalData
  • 8.2. Disclaimer

List of Tables

  • Table 1: Romanian Ongoing Procurement Programs
  • Table 2: Romanian Future Procurement Programs
  • Table 3: Romanian Defense Expenditure (RON Billion & US$ Billion), 2015-2024
  • Table 4: Romanian GDP Growth vs. Defense Expenditure as a Percentage of GDP Growth, 2015-2024
  • Table 5: Romanian Defense Budget Split Between Capital and Revenue Expenditure (%), 2015-2024
  • Table 6: Romanian Defense Capital Expenditure (RON Billion & US$ Billion), 2015-2024
  • Table 7: Romanian Per Capita Defense Expenditure (US$), 2015-2024
  • Table 8: Romanian Homeland Security Expenditure (RON Billion & US$ Billion), 2015-2024
  • Table 9: Benchmarking with Key Markets: 2015-2019 vs. 2020-2024
  • Table 10: Top Romanian Defense Market Sectors by Value (US$ Million) - 2019-2024
  • Table 11: Offset Regulations in Romania
  • Table 12: Romanian Budget Formation Timetable:
  • Table 13: Market Entry Strategies by Key Foreign Companies
  • Table 14: Competitive Landscape of the Romanian Defense Industry

List of Figures

  • Figure 1: Romanian Defense Budget: 2020 and 2024
  • Figure 2: Romanian Defense Imports/Exports: 2014 and 2018
  • Figure 3: Romania's Top Three Prospective Procurements/Developments
  • Figure 4: Romanian Defense Expenditure (RON Billion), 2015-2024
  • Figure 5: Romanian Defense Expenditure (US$ Billion), 2015-2024
  • Figure 6: Romanian GDP Growth vs. Defense Expenditure as a Percentage of GDP, 2015-2024
  • Figure 7: Romanian Defense Budget Split Between Capital and Revenue Expenditure (%), 2015-2024
  • Figure 8: Romanian Capital Budget Allocation (RON Billion), 2015-2024
  • Figure 9: Romanian Capital Budget Allocation (US$ Billion), 2015-2024
  • Figure 10: Romanian Per Capita Defense Expenditure (US$), 2015-2024
  • Figure 11: Romanian Homeland Security Expenditure (RON Billion), 2015-2024
  • Figure 12: Romanian Homeland Security Expenditure (US$ Billion), 2015-2024
  • Figure 13: Benchmarking with the World's Largest and Top Regional Defense Spenders (US$ Billion), 2019 and 2024
  • Figure 14: Defense Expenditure of the World's Largest Military Spenders (US$ Billion), 2019 and 2024
  • Figure 15: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2019
  • Figure 16: Romanian Defense Import Trend (US$ Million), 2014-2018
  • Figure 17: Romanian Defense Imports by Country (%), 2014-2018
  • Figure 18: Romanian Defense Imports by Category (%), 2014-2018
  • Figure 19: Romanian GDP Per Capita, 2015-2025
  • Figure 20: Romanian GDP, Current Prices (US$ Billion), 2015-2025
  • Figure 21: Romanian Export of Goods and Services (LCU Billion), 2005-2014
  • Figure 22: Romanian Imports of Goods and Services (LCU Billion), 2005-2014
  • Figure 23: Gross National Disposable Income (US$ Billion), 2005-2014
  • Figure 24: Local Currency per US$, 2015-2024
  • Figure 25: Romanian Market Capitalization of Listed Companies (US$ Billion), 2005-2012
  • Figure 26: Romanian Market Capitalization of Listed Companies (% of GDP), 2005-2012
  • Figure 27: Romanian Government Cash Surplus/Deficit as a % of GDP, 2005-2012
  • Figure 28: Romanian Goods Exports as a % of GDP, 2005-2014
  • Figure 29: Romanian Goods Imports as a % of GDP, 2005-2014
  • Figure 30: Romanian Service Imports as a % of GDP, 2005-2014
  • Figure 31: Romanian Service Exports as a % of GDP, 2005-2014
  • Figure 32: Romanian Net Foreign Direct Investment (US$ Billion), 2005-2014
  • Figure 33: Romanian Net Foreign Direct Investment as a % of GDP, 2005-2014
  • Figure 34: Romanian Mining, Manufacturing, Utilities Output (US$ Billion), 2005-2014
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