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

Region:Asia

Author(s):

Product Code:GDDF0546MR

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Published on

December 2018

Total pages

70

Table of Content

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About the Report

About the Report

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

Summary

"Future of the Georgian 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 Georgia's 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 Georgian defense industry market size and drivers: detailed analysis of the Georgian 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 Georgian defense industry.

Scope

- The Georgian defense budget (excluding US Aid) values USD 280.7 million in 2018, and registered a CAGR of -7.21% during the historic period.

- The decline in the defense budget during the historic period was due to the government's focus on diverting funds into other sectors to boost economic activity in the domestic sector, as a consequence of fiscal and political instability faced by Georgia after its war with Russia in 2008.

- These measures have affected the country's defense budget during the historic period.

- With an increased CAGR of 5.28% over the next five years, the country's defense expenditure is projected to value USD 361.6 million in 2023.

- Conversely, defense expenditure as a percentage of GDP is anticipated to slightly decrease from an average of 2.1% during 2014-2018 to an average of 1.6% during the forecast period.

Reasons to buy

- This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Georgian 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 Georgian defense industry covering sections including demand drivers, Key Trends , and latest industry contracts.

Products

Products

Defense, budget, offset, regulation, capital expenditure, homeland, key drivers and Challenges, market opportunities, procurement, entry route, announcements, alliances, contract awards, financial analysis, business environment, Raytheon, MBDA, State Military Scientific-Technical Center (STC) Delta


Companies

Raytheon

MBDA

State Military Scientific-Technical Center (STC) Delta

Table of Contents

Table of Contents

Table of Contents

1. Introduction 7

1.1. What is this Report About? 7

1.2. Definitions 7

1.3. Summary Methodology 9

1.4. About GlobalData 10

2. Executive Summary 11

3. Market Attractiveness and Emerging Opportunities 12

3.1. Current Market Conditions 13

3.1.1. Military fleet size 13

3.1.2. Procurement Programs 16

3.1.3. Key Drivers and Challenges 17

3.1.4. Proposed arms embargo against Georgia makes it difficult for defense companies 17

3.2. Defense Market Size Historical and Forecast 18

3.2.1. Georgian defense expenditure excluding US, aid to post a CAGR of 5.28% over the forecast period 18

3.2.2. Georgia's aggregate defense expenditure-inclusive of US military aid-will post a forecast-period CAGR of 3.84% 20

3.2.3. NATO membership, threats posed by Russia, and counter-terrorism and modernization plans drive defense expenditure 23

3.2.4. Military expenditure as a percentage of GDP is expected to decline over the forecast period 24

3.3. Analysis of Defense Budget Allocation 26

3.3.1. Share of capital expenditure to increase over the forecast period 26

3.3.2. Financial Aid from the US contributes a major share of the country's capital expenditure 28

3.3.3. Capital expenditure excluding US Aid to increase over the forecast period 29

3.3.4. Per capita defense expenditure to rise over the forecast period 31

3.4. Homeland Security Market Size and Forecast 33

3.4.1. Homeland security (HLS) expenditure expected to grow over the forecast period 33

3.4.2. Human trafficking, drug trafficking, and internal disputes to drive homeland security expenditure 35

3.4.3. Georgia faces a moderate level of terrorist threat 36

3.4.4. Georgia faces moderate level of threat from foreign terrorist organizations 37

3.4.5. Georgia has a terrorism index score of 2.1 39

3.5. Benchmarking with Key Global Markets 40

3.5.1. Georgian defense expenditure expected to remain low compared to leading spenders 40

3.5.2. The country's defense budget is high compared to its regional countries 42

3.5.3. Georgia defense expenditure as a percentage of GDP is expected to decrease 43

3.6. Market Opportunities: Key Trends 44

3.6.1. Top 10 Defense market sectors by value (USD Million)-Projections over period 2018-2023 44

4. Defense Procurement Market Dynamics 45

4.1. Import Market Dynamics 46

4.1.1. Defense imports expected to decrease over the forecast period 46

4.1.2. The US was the primary supplier of military platforms to Georgia 47

4.1.3. Naval vessel were the major imported military hardware during 2013-2017 48

4.2. Export Market Dynamics 49

4.2.1. Georgia does not export arms due to an undeveloped domestic arms industry 49

5. Industry Dynamics 50

5.1. Market Regulation 50

5.1.1. Georgia does not disclose any offset obligations imposed by the country 50

5.1.2. FDI in the defense sector is permitted only after review by the government 50

5.2. Market Entry Route 51

5.2.1. Budgeting Process 51

5.2.2. Foreign military sales (FMS) and direct commercial sales (DCS) preferred market entry routes 52

5.2.3. Establishment of subsidiaries provides an alternative entry route 52

6. Competitive Landscape and Strategic Insights 53

6.1. Competitive Landscape Overview 53

7. Business Environment and Country Risk 54

7.1. Economic Performance 54

7.1.1. GDP per capita 54

7.1.2. GDP, current prices 55

7.1.3. Export of goods and services (LCU Billion) 56

7.1.4. Import of goods and services (LCU Billion) 57

7.1.5. Gross national disposable income (USD Billion) 58

7.1.6. Local currency unit per USD 59

7.1.7. Market capitalization of listed companies 60

7.1.8. Market capitalization of listed companies as a percentage of GDP 61

7.1.9. Government cash surplus deficit as a percentage of GDP 62

7.1.10. Goods Exports as a percentage of GDP 63

7.1.11. Good imports as a percentage of GDP 64

7.1.12. Service imports as a percentage of GDP 65

7.1.13. Service exports as a percentage of GDP 66

7.1.14. Foreign direct investments 67

7.1.15. Net foreign direct investment as a percentage of GDP 68

7.1.16. Mining, manufacturing, utilities output 69

8. Appendix 70

8.1. About GlobalData 70

8.2. Disclaimer 70


List of Figure

List of Figures

Figure 1: Georgia-Defense Expenditure (GEL Million), 2014-2023 19

Figure 2: Georgia Defense Expenditure (USD Million), 2014-2023 19

Figure 3: Defense Expenditure, Excluding US Aid (USD Million), 2014-2023 21

Figure 4: US Military Aid to Georgia (USD Million), 2016-2023 21

Figure 5: Georgia-Defense Budget Excluding US Aid vs Defense Expenditure Including US Aid (USD Million), 2014-2023 22

Figure 6: Georgia-GDP Growth vs Defense Expenditure According to Percentage of GDP Growth, 2014-2023 25

Figure 7:Georgia-Defense Budget Split by Capital and Revenue Expenditure (%), 2014-2023 27

Figure 8: Georgia-Capital Expenditure Allocated vs Total Including US Military Aid (USD Million), 2014-2023 28

Figure 9: Georgia-Defense Capital Expenditure Excluding US Aid (GEL Million), 2014-2023 30

Figure 10: Georgia-Defense Capital Expenditure Excluding US Aid (USD Million), 2014-2023 30

Figure 11: Georgia Per Capita Defense Expenditure (USD ), 2014-2023 32

Figure 12: Georgia-Homeland Security Budget (GEL Million), 2014-2023 34

Figure 13: Georgian Homeland Security Budget (USD Million), 2014-2023 34

Figure 14: Terrorism Heat Map, 2018 36

Figure 15: Terrorism Index, 2018 39

Figure 16: Benchmarking with Key Markets-2014-2018 vs 2019-2023 41

Figure 17: Defense Expenditure of the World's Largest Military Spenders (USD Billion), 2018 and 2023 42

Figure 18: Defense Expenditure According to Percentage of GDP of Largest Military Spenders (%), 2018 43

Figure 19: Georgia-Defense Imports Trend (USD Million), 2013-2017 46

Figure 20: Georgia-Defense Imports by Country (%), 2013-2017 47

Figure 21: Georgia-Defense Imports by Category (%), 2013-2017 48

Figure 22: Georgia-GDP Per Capita (USD ), 2015-2025 54

Figure 23: Georgia-GDP Current Prices (USD Billion), 2015-2025 55

Figure 24: Georgia-Export of Goods and Services (LCU Billion), 2005-2014 56

Figure 25: Georgia-Import of Goods and Services (LCU Billion), 2005-2014 57

Figure 26: Georgia-Gross National Disposable Income (USD Billion), 2005-2013 58

Figure 27: Georgia-LCU per USD , 2015-2024 59

Figure 28: Georgia-Market Capitalization of Listed Companies (USD Billion), 2005-2012 60

Figure 29: Georgia-Market Capitalization of Listed Companies (Percentage of GDP), 2005-2012 61

Figure 30: Georgia-Cash Surplus Deficit as (Percentage of GDP), 2008-2012 62

Figure 31: Georgia-Good Exports as a Percentage of GDP, 2005-2014 63

Figure 32: Georgia-Good Imports as a Percentage of GDP, 2005-2014 64

Figure 33: Georgia-Service Imports as a Percentage of GDP, 2005-2014 65

Figure 34: Georgia-Service Exports as a Percentage of GDP, 2005-2014 66

Figure 35: Georgia-Foreign Direct Investments (BoP, Current USD Billion), 2005-2014 67

Figure 36: Georgia-Net Foreign Direct Investment as a Percentage of GDP, 2005-2014 68

Figure 37: Georgia-Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014 69


List of Table

List of Tables

Table 1: Georgia-Army Strength 13

Table 2: Georgia-Navy and Coast Gurad Strength 15

Table 3: Georgia-Air Force Strength 15

Table 4: Georgia-Ongoing Procurement Programs 16

Table 5: Georgian Future Procurement Programs 16

Table 6: Georgia-Defense Expenditure (GEL million and USD million), 2014-2023 18

Table 7: Total Georgian Defense Expenditure Including US Aid (USD Million ), 2014-2023 20

Table 8: Georgia-GDP Growth vs Defense Expenditure According to Percentage of GDP Growth, 2014-2023 24

Table 9: Georgia-Defense Budget Split by Capital and Revenue Expenditure (%), 2014-2023 26

Table 10: Georgia-Capital Expenditure Split by Allocated Capital Expenditure and US Military Aid (USD Million), 2014-2023 28

Table 11: Georgia-Defense Capital Expenditure Excluding US Aid (GEL million and USD million), 2014-2023 29

Table 12: Georgia-Per Capita Defense Expenditure (USD ), 2014-2023 31

Table 13: Georgia-Homeland Security Expenditure (GEL Million and USD Million), 2014-2023 33

Table 14: Terrorism Index, 2018 37

Table 15: Benchmarking with Key Markets-2014-2018 vs 2019-2023 40

Table 16: Top 10 Georgia Defense Market Sectors by Value (USD Million)-2018-2023 44

Table 17: Georgia-Budget Formation Timetable 51

Table 18: Georgia-Competitive Landscape of Defense Industry, 2018 53

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