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South Africa Defence and Security Report 2015

South Africa Defence and Security Report 2015

BMI View: South Africa possesses the largest defence sector in Africa, and local manufacturers - agrowing number of which are entering into international product development partnerships - export itemssuch as armoured vehicles, artillery and defence electronics to a wide range of countries across the world.

Domestic demand for defence equipment remains strong, driven by Pretoria's continued commitment toregional peacekeeping, as well as the high levels of crime and social instability in the country, whichnecessitate a broad military presence internally and along borders. Despite this, however, South Africandefence expenditure remains limited, as the government budget continues to focus mainly on social andeconomic development - leaving military spend as a percentage of GDP at just over 1%.

In 2015, Pretoria has committed to another year of military support to the DRC, agreed to cover the firststandby period for the African Capacity for Immediate Response to Crises (ACIRC) force and continue itscounter-piracy patrol off the East African coast (albeit without support from the air force). The SANDF willneed to maintain its border security presence in the face of heightened levels of transnational crime andillegal immigration, while at the same time be prepared to deal with any escalation in violence caused bysocial instability. Despite these factors, however, the defence allocation in the 2015 national budgetrepresents another year-on-year (y-o-y) decline in real terms, illustrating the government's continuedreluctance to increase sector spending as a percentage of the total. The ruling African National Congress(ANC), widely criticised for poor service delivery, has lost support from large sections of the electorate inrecent quarters, and major budget increases for the military would prove unpopular with many voters - notleast because of the corruption allegations that have historically surrounded ARMSCOR contracts.

BMI therefore expects overall defence expenditure for the year to drop by 3.7% y-o-y, reaching a total ofUSD3.6bn.


BMI Industry View
SWOT
South Africa Defence SWOT
Political
Economic
Operational Risk
Industry Forecast
Defence Expenditure
Table: Defence Expenditure (South Africa 2012-2019)
Armed Forces
Table: Armed Forces Personnel (South Africa 2005-2012)
Table: Manpower Available For Military Service (South Africa 2012-2019)
Exports
Imports
Macroeconomic Forecasts
Economic Analysis
Table: Economic Activity (South Africa 2010-2019)
Industry Risk Reward Index
South Africa Security Risk Index
Table: Middle East And Africa - Defence Industry Risk Reward Index
Rewards
Risks
Market Overview
South Africa Security Overview
Domestic Threats
Regional Threats
International Threats
Weapons Of Mass Destruction
South Africa Defence Market Overview
Domestic Defence Sector
Domestic Defence Market
International Partnerships And Defence Agreements
Table: South Africa - Key Defence Agreements
Company Profile
Aerosud
BAE Systems Land Systems South Africa
Denel
Reutech
Saab Grintek Defence
Thales South Africa
Regional Overview
Table: Democracies With Little Competition
Global Industry Overview
Political Risk Analysis
Methodology
Sector-Specific Methodology
Table: Defence Risk Reward Index Indicators
Weighting
Table: Weighting of Defence Risk Reward Index

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