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Future of the Kuwaiti Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2019

Published By :

Strategic Defence Intelligence

Published Date : Dec 2014

Category :

Defense and Security

No. of Pages : 90 Pages


The Future of the Kuwaiti Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2019, 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.

Key Findings

  • Over the historic period, Kuwait’s defense expenditure registered a growth rate of -0.56%, decreasing from US$4.7 billion in 2010 to US$4.6 billion in 2014
  • Kuwait’s military expenditure, valued at US$4.6 billion in 2014, is expected to increase to US$5 billion by 2019, registering a CAGR of 1.02% over the forecast period
  • Kuwaiti military expenditure will be driven by the country’s relationship with Iraq, and military modernization programs ably supported by additional revenue created by a rise in petroleum prices
  • The Defense Ministry is expected to procure missile defense systems, aircraft, and naval vessels

Synopsis

This report offers detailed analysis of the Kuwaiti 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: 

  • Kuwaiti defense industry market size and drivers: detailed analysis of the Kuwaiti defense industry during 2015–2019, 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 the army, navy, and air force. It also details the key challenges faced by defense market participants within the country
  • Porter’s Five Force analysis of the Kuwaiti 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 country’s imports and exports over the last five years 
  • Market opportunities: details of the top five defense investment opportunities over the coming 10 years
  • Competitive landscape and strategic insights: analysis of the competitive landscape of the Kuwaiti defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis

Reasons To Buy

  • This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Kuwaiti 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 Kuwaiti defense industry covering sections including demand drivers, Porter’s Five Forces Analysis, Key Trends and Growth Stimulators, and latest industry contracts
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

2 Executive Summary

3 Market Attractiveness and Emerging Opportunities
3.1. Defense Market Size Historical and Forecast
3.1.1. Defense expenditure expected to grow at a CAGR of 1.02% over the forecast period
3.1.2. Border dispute with Iraq and military modernization program are expected to be a key factor driving defense expenditure
3.1.3. Defense budget as a percentage of GDP expected to average 4.6% over the forecast period
3.2. Analysis of Defense Budget Allocation
3.2.1. Capital expenditure allocation to average 20.5% of the total budget over the forecast period
3.2.2. Procurement of equipment expected to pick up over forecast period
3.2.3. Per capita defense expenditure expected to decrease over the forecast period
3.3. Homeland Security Market Size and Forecast
3.3.1. Homeland security budget expected to increase over the forecast period
3.3.2. Cyber threats, the illegal drug trade, and human trafficking will be the key factors driving homeland security
3.3.3. Kuwait considered at ‘some risk’ of terrorist attack
3.4. Benchmarking with Key Global Markets
3.4.1. Kuwait to remain near the bottom of the top defense spenders list
3.4.2. The country’s defense budget is low compared to other Middle Eastern countries
3.4.3. Kuwait defense expenditure as a percentage of GDP expected to increase
3.4.4. Kuwait faces low threat from foreign terrorist organizations
3.5. Market Opportunities: Key Trends and Drivers
3.5.1. Demand for missile defense systems is expected to increase
3.5.2. Demand for military aircraft to increase
3.5.3. Defense for naval ships expected to increase over the forecast period

4 Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Defense industry heavily relies on imports from foreign countries
4.1.2. The US and Russia were the key defense suppliers to Kuwait
4.1.3. Armored Vehicles and Missiles to dominate Kuwaiti defense imports
4.2. Export Market Dynamics
4.2.1. Kuwait’s defense export market is negligible

5 Industry Dynamics
5.1. Five Forces Analysis
5.1.1. Bargaining power of supplier: high
5.1.2. Bargaining power of buyer: medium to high
5.1.3. Barrier to entry: medium
5.1.4. Intensity of rivalry: low to medium
5.1.5. Threat of substitution: high

6 Market Entry Strategy
6.1. Market Regulation
6.1.1. The Kuwaiti government does not disclose FDI in the defense industry
6.1.2. Offset Policy aids transfer of advanced technologies and their integration into the local economy
6.2. Market Entry Route
6.2.1. Foreign Military Sales (FMS) is the preferred entry route
6.2.2. Gulf Co-operation Council (GCC) to form joint Military Command, which could be an alternative entry route for foreign OEM’s
6.3. Key Challenges
6.3.1. The US and Russia dominate the market, posing challenges to other foreign firms
6.3.2. Scarcity of skilled labor

7 Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.1.1. Kuwaiti defense sector is dominated by foreign competitors
7.2. Key Foreign Companies
7.2.1. Lockheed Martin: overview
7.2.2. Lockheed Martin: products and services
7.2.3. Lockheed Martin: recent announcements and strategic initiatives
7.2.4. Lockheed Martin: recent contract wins
7.2.5. Raytheon: Overview
7.2.6. Raytheon: Major Products and Services
7.2.7. Raytheon: Recent Announcements and Strategic Initiatives
7.2.8. Raytheon: Contracts
7.2.9. Abu Dhabi Ship Building PJSC: Overview
7.2.10. Abu Dhabi Ship Building PJSC: Contracts
7.2.11. Boeing: overview
7.2.12. Boeing: Recent Announcements and Strategic Initiatives
7.2.13. Boeing: Contracts

8 Business Environment and Country Risk
8.1. Demographics & Social Statistics
8.1.1. Population – Rural
8.1.2. Population - Urban
8.2. Economic Performance
8.2.1. GDP per Capita
8.2.2. Gross Domestic Product
8.2.3. Exports of Goods and Services
8.2.4. Imports of Goods and Services
8.2.5. Manufacturing Output
8.2.6. Consumer Price Index
8.2.7. LCU per Euro (period average)
8.2.8. Lending Rate (%)
8.2.9. Deposit Rate
8.2.10. Real Interest Rate
8.2.11. Market Capitalization of Listed Companies
8.2.12. Market Capitalization of listed companies as a % GDP
8.2.13. Total Government cash surplus/deficit
8.2.14. Total Government cash surplus/deficit as % of GDP
8.2.15. Goods Exports as a % of GDP
8.2.16. Goods Imports as a % of GDP
8.2.17. Goods Trade Surplus/Deficit as a % of GDP
8.2.18. Services Imports as a % of GDP
8.2.19. Services Exports as a % of GDP
8.2.20. Services Trade Surplus/Deficit as a % of GDP
8.2.21. Net Foreign Direct Investment
8.2.22. Net Foreign Direct Investment as % of GDP
8.2.23. International reserves, including gold
8.3. Energy and Utilities
8.3.1. Total Conventional Thermal Electricity Net Generation
8.3.2. Total Conventional Thermal Electricity Installed Capacity
8.3.3. Total Petroleum Consumption
8.4. Minerals
8.4.1. Mining, Manufacturing, Utilities Output
8.5. Telecommunication
8.5.1. Telephone Lines
8.5.2. Telephone lines Penetration Rate

9 Appendix
9.1. About SDI
9.2. Disclaimer

List of Table


Table 1: Kuwaiti Defense Expenditure (US$ Billion), 2010–2014
Table 2: Kuwaiti Defense Expenditure (US$ Billion), 2015–2019
Table 3: Kuwaiti Defense Expenditure (KWD Billion), 2010–2014
Table 4: Kuwaiti Defense Expenditure (KWD Billion), 2015–2019
Table 5: Kuwaiti GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2010–2014
Table 6: Kuwaiti GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2015–2019
Table 7: Kuwaiti Defense Budget Split Between Capital and Revenue Expenditure (%),  2010–2014
Table 8: Kuwaiti Defense Budget Split Between Capital and Revenue Expenditure (%),  2015–2019
Table 9: Kuwaiti Defense Capital Expenditure (US$ Million), 2010– 2014
Table 10: Kuwaiti Defense Capital Expenditure (US$ Million), 2015 – 2019
Table 11: Kuwaiti Defense Capital Expenditure (KWD Million), 2010– 2014
Table 12: Kuwaiti Defense Capital Expenditure (KWD Million), 2015 – 2019
Table 13: Kuwaiti Per Capita Defense Expenditure (US$), 2010–2014
Table 14: Kuwaiti Per Capita Defense Expenditure (US$), 2015–2019
Table 15: Kuwaiti Homeland Security Budget (US$ Billion), 2010–2014
Table 16: Kuwaiti Homeland Security Budget (US$ Billion), 2015–2019
Table 17: Kuwaiti Homeland Security Budget (KWD Billion), 2010–2014
Table 18: Kuwaiti Homeland Security Budget (KWD Billion), 2015–2019
Table 19: Benchmarking with Key Markets – 2010–2014 vs. 2015–2019
Table 20: SDI Terrorism Index
Table 21: Offset Regulations in Kuwait
Table 22: Bell Helicopter Textron, Inc. – Product Focus
Table 23: Bell Helicopter Textron, Inc. – Recent Contract Wins
Table 24: Raytheon – Major Products & Services
Table 25: Raytheon – Contracts
Table 26: Raytheon – Contracts
Table 27: Raytheon – Contracts

List of Chart

Figure 1: Kuwaiti Defense Expenditure (US$ Billion), 2010–2014
Figure 2: Kuwaiti Defense Expenditure (US$ Billion), 2015–2019
Figure 3: Kuwaiti Defense Expenditure (KWD Billion), 2010–2014
Figure 4: Kuwaiti Defense Expenditure (KWD Billion), 2015–2019
Figure 5: Kuwaiti GDP Growth vs. Defense Expenditure Growth and Defense Expenditures Percentage of GDP Growth, 2010–2014
Figure 6: Kuwaiti GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as Percentage of GDP Growth, 2015–2019
Figure 7: Kuwaiti Defense Budget Split Between Capital and Revenue Expenditure (%), 2010–2014
Figure 8: Kuwaiti Defense Budget Split Between Capital and Revenue Expenditure (%), 2015–2019
Figure 9: Kuwaiti Defense Capital Expenditure (US$ Million), 2010–2014
Figure 10: Kuwaiti Defense Capital Expenditure (US$ Million), 2015–2019
Figure 11: Kuwaiti Defense Capital Expenditure (KWD Million), 2010–2014
Figure 12: Kuwaiti Defense Capital Expenditure (KWD Million), 2015–2019
Figure 13: Kuwaiti Per Capita Defense Expenditure (US$), 2010–2014
Figure 14: Kuwaiti Per Capita Defense Expenditure (US$), 2015–2019
Figure 15: Kuwaiti Homeland Security Budget (US$ Billion), 2010–2014
Figure 16: Kuwaiti Homeland Security Budget (US$ Billion), 2015–2019
Figure 17: Kuwaiti Homeland Security Budget (KWD Billion), 2010–2014
Figure 18: Kuwaiti Homeland Security Budget (KWD Billion), 2015–2019
Figure 19: SDI Terrorism Heat Map, 2014
Figure 20: SDI Terrorism Index, 2014
Figure 21: Benchmarking with Key Markets – 2010–2014 vs. 2015–2019
Figure 22: Benchmarking with World’s Largest Defense Spenders (US$ Billion),  2014 and 2019
Figure 23: Benchmarking with Large Defense Spenders as % of GDP – 2014
Figure 24: Kuwaiti Defense Import Trend, 2009–2013 (TIV values)
Figure 25: Kuwaiti Defense Imports by Country (%), 2009–2013
Figure 26: Kuwaiti Defense Imports by Weapon Category (%), 2009–2013
Figure 27: Industry Dynamics – Porter’s Five Forces Analysis
Figure 28: Kuwaiti Population – Rural (In Million), 2014–2023
Figure 29: Kuwaiti Population – Urban (In Million), 2014–2023
Figure 30: Kuwaiti GDP per Capita (US$), 2014–2023
Figure 31: Kuwaiti GDP (current US$ bn), 2014–2023
Figure 32: Kuwaiti Exports of goods and services (current US$ Bn), 2002–2011
Figure 33: Kuwaiti Imports of goods and services (current US$ Bn), 2002–2011
Figure 34: Kuwaiti Manufacturing Output (US$ Bn), 2002–2011
Figure 35: Kuwaiti Consumer Price Index, 2014–2023
Figure 36: Kuwaiti LCU per Euro, 2014–2023
Figure 37: Kuwaiti Lending Rate (%), 2002–2011
Figure 38: Deposit Rate (%), 2002–2011
Figure 39: Kuwaiti Real Interest Rate (%), 2002–2011
Figure 40: Kuwaiti Market Capitalization of listed companies (US$ Bn), 2003–2012
Figure 41: Kuwaiti Market Capitalization of listed companies (%of GDP), 2002–2011
Figure 42: Kuwaiti Total Government cash surplus/deficit (LCU Bn), 2002–2011
Figure 43: Kuwaiti Total Government cash surplus/deficit as % of GDP, 2002–2011
Figure 44: Kuwaiti Goods Exports as a % of GDP, 2001–2010
Figure 45: Kuwaiti Goods Imports as a % of GDP, 2001–2010
Figure 46: Kuwaiti Goods Trade Surplus/Deficit as a % of GDP, 2001–2010
Figure 47: Kuwaiti Services Imports as a % of GDP, 2001–2010
Figure 48: Kuwaiti Services Exports as a % of GDP, 2001–2010
Figure 49: Kuwaiti Services Trade Surplus/Deficit as a % of GDP, 2001–2010
Figure 50: Kuwaiti Net Foreign Direct Investment (US$ Bn), 2001–2010
Figure 51: Kuwaiti Net Foreign Direct Investment as % of GDP, 2001–2010
Figure 52: Kuwaiti International reserves, including gold (US$ Bn), 2002–2011
Figure 53: Kuwaiti Total Conventional Thermal Electricity net Generation (Bn Kilowatt Hours), 2002–2011
Figure 54: Kuwaiti Total Conventional Thermal Electricity Installed Capacity (Bn Kilowatt Hours), 2001–2010
Figure 55: Kuwaiti Total Petroleum Consumption (Thousand Barrels per Day),
Figure 56: Mining, Manufacturing, Utilities Output (in Millions), 2002–2011
Figure 57: Kuwaiti Telephone Lines (in Millions), 2003–2012
Figure 58: Kuwaiti Telephone lines Penetration Rate (per 100 people), 2003–2012

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