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Future of the Brunei Defense Industry - Market Attractiveness, Competitive Landscape, and Forecasts to 2022

Published By :

Strategic Defence Intelligence

Published Date : Jun 2017

Category :

Defense and Security

No. of Pages : 76 Pages

Future of the Brunei Defense Industry - Market Attractiveness, Competitive Landscape, and Forecasts to 2022

Summary

The Future of Brunei Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2022, published by Strategic Defence Intelligence, 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.

Synopsis

This report offers detailed analysis of Brunei 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 -
- Brunei defense industry market size and drivers: detailed analysis of Brunei defense industry during 2018-2022, including highlights of the demand drivers and growth stimulators for the industry. It also provides a snapshot of the countrys expenditure and modernization patterns
- Budget allocation and key challenges: insights into procurement schedules formulated within the country and a breakdown of the defense budget. It also details the key challenges faced by defense market participants within the country
- Porters Five Force analysis of Brunei defense industry: analysis of the market characteristics by determining the bargaining power of suppliers, bargaining power of buyers, threat of substitution, intensity of rivalry, and barriers to entry
- Import and Export Dynamics: analysis of prevalent trends in the countrys imports and exports over the last five years
- Market opportunities: details of the top five defense investment opportunities over the next 10 years
- Competitive landscape and strategic insights: analysis of the competitive landscape of Brunei defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis

Scope

- The Brunei defense budget stands at US$331.7 million in 2017 and registered a CAGR of -5.67% during the historic period.Expenditure will be driven by territorial disputes in the South China Sea, military modernization of RBAF, and threat of terrorism. Demand is expected to revolve around multi-mission helicopters, maritime surveillance radar, airspace surveillance platforms, maritime patrol aircraft, fixed wing transport aircraft, and medium range air defense systems. Over the forecast period, revenue expenditure is expected to reach US$262.2 million by 2022, registering a CAGR of 3.31%. This increase is owing to a construction of a new naval training school for the Royal Brunei Navy, personnel salaries, operational expenses, and training of armed forces.
- During 2013-2017, an average of 32.4% of the countrys defense budget was allocated to capital expenditure, while an average of 67.6% was reserved for revenue expenditure. Over the forecast period 2018-2022, the share of capital expenditure is expected to average 32.5%, while the remaining 67.5% will be assigned to revenue expenditure, which will continue to comprise the majority of the nations defense budget.
- The MoD is expected to invest in multi-mission helicopter, transport aircraft, maritime patrol aircraft.

Reasons to buy

- This report will give the user confidence to make the correct business decisions based on a detailed analysis of Brunei 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 Brunei defense industry covering sections including demand drivers, Porters Five Forces Analysis, Key Trends and Growth Stimulators, and latest industry contracts
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 Strategic Defence Intelligence 10
2. Executive Summary 11
3. Market Attractiveness and Emerging Opportunities 12
3.1. Current Market Scenario 13
3.1.1. Primary threat perception 13
3.1.2. Military Doctrine & Strategy 15
3.1.3. Military Fleet Size 16
3.1.4. Procurement Programs 18
3.1.5. Social, Political and Economic Environment & Support for Defense Projects 19
3.1.6. Political & Strategic Alliances 20
3.2. Defense Market Size Historical and Forecast 22
3.2.1. Brunei defense expenditure is expected to reach US$389 million by 2022 22
3.2.2. Territorial disputes in the South China Sea, military modernization initiatives, and threat of terrorism are expected to drive defense expenditure over the forecast period 24
3.2.3. Brunei defense expenditure as a percentage of GDP is expected to decrease marginally over the forecast period 26
3.3. Analysis of Defense Budget Allocation 28
3.3.1. Capital expenditure allocation expected to increase during the forecast period 28
3.3.2. Capital expenditure to increase at a CAGR of 3.61% over 2018-2022 30
3.3.3. Brunei revenue expenditure is projected to reach US$1.2 billion cumulatively over forecast period 32
3.3.4. Per capita defense expenditure is expected to increase during the forecast period 34
3.4. Homeland Security Market Size and Forecast 36
3.4.1. Brunei homeland security market to increase at a CAGR of 2.70% over the forecast period 36
3.4.2. Homeland security expenditure to be driven by human and illicit drug trafficking 38
3.4.3. Brunei faces some level of threat from terrorism 40
3.5. Benchmarking with Key Global Markets 41
3.5.1. Bruneis defense budget is poised to grow over the forecast period 41
3.5.2. Bruneis defense spending is low compared to other major military spenders 43
3.5.3. Brunei allocates a significant percentage of GDP towards defense spending 44
3.6. Market Opportunities: Key Trends and Growth Stimulators 45
3.6.1. Multi-mission Helicopter 45
3.6.2. Transport aircraft 46
3.6.3. Maritime patrol aircraft 46
4. Defense Procurement Market Dynamics 47
4.1. Import Dynamics 48
4.1.1. Defense imports recorded a decline during 2011-2015 48
4.1.2. Brunei sourced the majority of its arms imports from Germany 49
4.1.3. Ship and Aircraft accounted for the majority of arms imports during 2011-2015 50
4.2. Export Market Dynamics 51
4.2.1. Brunei does not export military hardware due to lack of domestic manufacturing capacity 51
5. Industry Dynamics 52
5.1. Five Forces Analysis 52
5.1.1. Bargaining power of supplier: low 53
5.1.2. Bargaining power of buyer: low to medium 53
5.1.3. Barrier to entry: high 53
5.1.4. Intensity of rivalry: low to medium 53
5.1.5. Threat of substitution: low 53
6. Market Entry Strategy 54
6.1. Market Regulation 54
6.1.1. Brunei has not disclosed any offset obligations imposed by the country 54
6.1.2. FDI in the defense sector is controlled entirely by the government 54
6.2. Market Entry Route 55
6.2.1. Budget Process 55
6.2.2. Procurement Policy & Process 56
6.2.3. The biennial defense exhibition provides an attractive entry route 56
6.2.4. Direct commercial sales being the preferred entry route 56
6.2.5. Closer military co-operation provides opportunity to enter into defense market 57
6.3. Key Challenges 58
6.3.1. A relatively small defense budget fails to attract investors and suppliers 58
6.3.2. Lack of transparency in the bidding process makes foreign companies wary of investing 58
6.3.3. Lack of skilled labor 58
7. Competitive Landscape and Strategic Insights 59
7.1. Competitive Landscape Overview 59
7.2. Key Private Sector Companies 60
7.2.1. Royal Brunei Technical Services: Overview 60
7.2.2. Royal Brunei Technical Services: Services 60
7.2.3. Royal Brunei Technical Services: Recent announcements and strategic initiatives 61
7.2.4. Royal Brunei Technical Services: Alliances 61
7.2.5. Royal Brunei Technical Services: Recent contract wins 62
8. Business Environment and Country Risk 63
8.1. Economic Performance 63
8.1.1. GDP Per Capita 63
8.1.2. GDP, Current Prices 64
8.1.3. Exports of goods and services, current prices 65
8.1.4. Imports of goods and services, current prices 66
8.1.5. Gross National disposable income (US$ Billion) 67
8.1.6. Local Currency Unit per US Dollar 68
8.1.7. Goods exports as a percentage of GDP 69
8.1.8. Goods imports as a percentage of GDP 70
8.1.9. Service Imports as a percentage of GDP 71
8.1.10. Service Exports as a percentage of GDP 72
8.1.11. Foreign direct investment, net (BoP, current US$ Bn) 73
8.1.12. Net foreign direct investment as % of GDP 74
8.1.13. Mining, Manufacturing, Utilities Output (LCU Billion) 75
9. Appendix 76
9.1. About SDI 76
9.2. Disclaimer 76

List of Tables
Table 1: Brunei Land Forces Strength 16
Table 2: Brunei Navy Strength 16
Table 3: Brunei Air Force Strength 17
Table 4: Brunei Ongoing Procurement Programs 18
Table 5: Brunei Future Procurement Programs 18
Table 6: Brunei Defense Expenditure (BND Million & US$ Million), 2013-2022 22
Table 7: Brunei GDP Growth vs. Defense Expenditure as a Percentage of GDP, 2013-2022 26
Table 8: Brunei Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2022 28
Table 9: Brunei Defense Capital Expenditure (BND Million & US$ Million), 2013-2022 30
Table 10: Brunei Defense Revenue Expenditure (BND Million & US$ Million), 2013-2022 32
Table 11: Brunei Per-Capita Defense Expenditure (US$), 2013-2022 34
Table 12: Brunei Homeland Security Expenditure (BND Million & US$ Million), 2013-2022 36
Table 13: Benchmarking with Key Markets - 2013-2017 vs. 2018-2022 41
Table 14: Transport Aircraft Procurement 46
Table 15: Maritime Patrol Aircraft Procurement 46
Table 16: Brunei Budget Preparation Process 55
Table 17: Brunei - Competitive Landscape of Defense Industry, 2017 59
Table 18: Royal Brunei Technical Services 60
Table 19: Royal Brunei Technical Services - Alliances 61
Table 20: Royal Brunei Technical Services - Recent Contract Wins 62

List of Figures
Figure 1: Brunei Defense Expenditure (BND Million), 2013-2022 23
Figure 2: Brunei Defense Expenditure (US$ Million), 2013-2022 23
Figure 3: Brunei GDP Growth vs. Defense Expenditure as Percentage of GDP, 2013-2022 27
Figure 4:Brunei Budget Split Between Capital and Revenue Expenditure (%), 2013-2022 29
Figure 5: Brunei Defense Capital Expenditure (BND Million), 2013-2022 31
Figure 6: Brunei Defense Capital Expenditure (US$ Million), 2013-2022 31
Figure 7: Brunei Defense Revenue Expenditure (BND Million), 2013-2022 33
Figure 8:Brunei Defense Revenue Expenditure (US$ Million), 2013-2022 33
Figure 9: Brunei Per Capita Expenditure (US$), 2013-2022 35
Figure 10: Brunei Homeland Security Budget (BND Million), 2013-2022 37
Figure 11: Brunei Homeland Security Budget (US$ Million), 2013-2022 37
Figure 12: Terrorism Heat Map, 2017 40
Figure 13: Benchmarking with Key Markets - 2013-2017 vs. 2018-2022 42
Figure 14: Defense Expenditure of the Worlds Largest Military Spenders (US$ Billion), 2017 and 2022 43
Figure 15: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2017 44
Figure 16: Multi-mission Helicopter Market Size (US$ Million), 2017-2019 45
Figure 17: Brunei Defense Imports (US$ Million), 2011-2015 48
Figure 18: Brunei Defense Imports by Country (%), 2011-2015 49
Figure 19: Brunei Defense Imports by Weapon Category (%), 2011-2015 50
Figure 20: Industry Dynamics Porters Five Forces Analysis 52
Figure 21: Brunei GDP Per Capita, 2015-2025 63
Figure 22: Brunei GDP, Current Prices (In US$ Billions), 2015-2025 64
Figure 23: Brunei Exports of goods and services, current prices (LCU Billion), 2005- 2014 65
Figure 24: Brunei Imports of goods and services, current prices (LCU Billion), 2005-2014 66
Figure 25: Brunei Gross National Disposable Income (US$ Billion), 2010-2013 67
Figure 26: Local Currency Unit per US$- Exchange Rate, 2015-2024 68
Figure 27: Brunei Goods Exports as a percentage of GDP, 2005-2009 69
Figure 28: Brunei Goods Imports as a percentage of GDP, 2005-2009 70
Figure 29: Brunei Service Imports as a percentage of GDP, 2005-2009 71
Figure 30: Brunei Service Exports as % of GDP, 2005-2009 72
Figure 31: Brunei Foreign direct investment, net (BoP, current US$ Bn), 2005-2009 73
Figure 32: Brunei Net foreign direct investment as % of GDP, 2005-2009 74
Figure 33: Brunei Mining, Manufacturing, Utilities Output (LCU Billion), 2005-2014 75

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