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

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

Summary

Egypt has undergone a period of political turmoil since January 2011 which began with the ousting of President Hosni Mubarak following 30 years of autocratic rule and ended in the nation’s first democratic elections which saw a new President being elected and deposed 13 months later.

Egypt’s total defense expenditure, including US military aid, valued US$3.1 billion in 2018 and is anticipated to post a forecast-period CAGR of 6.58% to reach US$4.4 billion in 2023. During the historic period, Egypt allocated an average of 16.4% of its total defense budget towards capital expenditure. However, capital expenditure’s share of the overall defense budget is anticipated to increase to an average of 17.1% over the forecast period, due to the country’s procurement plans.

Capital investment is anticipated to be driven by the need to replace obsolete military equipment such as multirole fighter aircraft, helicopters, air defense missile systems, naval vessels, offshore patrol vessels, surveillance systems, and light weapons and ammunition. Furthermore, MoD is expected to invest in Fighters & Multi-role Aircraft, Land Based C4ISR and Airborne C4ISR.

The Future of the Egyptian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023, 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.

This report offers detailed analysis of the Egyptian 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 Egyptian defense industry market size and drivers: detailed analysis of the Egyptian 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
- Porter’s Five Force analysis of the Egyptian 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 next 10 years
- Competitive landscape and strategic insights: analysis of the competitive landscape of the Egyptian defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis.

Companies Mentioned - Abu Zaabal tank repair factory, Arab Organization for Industrialization-Engine Factory, Arab Organization for Industrialization-Aircraft Factory, Arab Organization for Industrialization-Sakr Factory, Arab Organization for Industrialization-Kader Factory, Arab Organization for Industrialization-Electronics Factory,Arab British Dynamics Company - Product Focus , Helwan Factory for Developed Industries- Services, Lockheed Martin, General Dynamics Corporation, Sikorsky Aircraft Corporation, Boeing, Dassault Aviation,Thales, Naval Group (Formerly DCNS),United Aircraft Corporation (UAC) and Uralvagonzavod (UVZ)

Scope

- Egypt’s total defense expenditure, including US military aid, valued US$3.1 billion in 2018 and is anticipated to post a forecast-period CAGR of 6.58% to reach US$4.4 billion in 2023.
- The country has undergone a period of political turmoil since January 2011 which began with the ousting of President Hosni Mubarak following 30 years of autocratic rule and ended in the nation’s first democratic elections which saw a new President being elected and deposed 13 months later.
- During the historic period, Egypt allocated an average of 16.4% of its total defense budget towards capital expenditure. However, capital expenditure’s share of the overall defense budget is anticipated to increase to an average of 17.1% over the forecast period, due to the country’s procurement plans. Capital investment is anticipated to be driven by the need to replace obsolete military equipment such as multirole fighter aircraft, helicopters, air defense missile systems, naval vessels, offshore patrol vessels, surveillance systems, and light weapons and ammunition.
- The MoD is expected to invest in Fighters & Multi-role Aircraft, Land Based C4ISR, Airborne C4ISR.

Reasons to buy

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


1. Introduction
1.1. What is this Report About?
1.2. Definitions
1.3. Summary Methodology
1.4. About Strategic Defence Intelligence
2. Executive Summary
3. Market Attractiveness and Emerging Opportunities
3.1. Current Market Scenario
3.1.1. Primary Threat Perception
3.1.2. Military Doctrine and Strategy
3.1.3. Military Fleet Size
3.1.4. Procurement Programs
3.1.5. Social, Political and Economic Environment and Support for Defense Projects
3.1.6. Political and Strategic Alliances
3.2. Defense Market Size Historical and Forecast
3.2.1. Egyptian aggregate defense expenditure, inclusive of US military aid, is anticipated to post a CAGR of 4.84% over the forecast period
3.2.2. Egypt’s defense budget (excluding US military aid) is expected to cumulatively value US$19.5 billion over the forecast period
3.2.3. Perceived threats, military modernization, a strained relationship with Ethiopia, peacekeeping operations, and domestic turbulence expected to drive the country’s defense expenditure
3.2.4. Defense expenditure as a percentage of GDP is anticipated to decline during 2019-2023
3.3. Analysis of Defense Budget Allocation
3.3.1. The country’s capital expenditure allocation is anticipated to increase over the forecast period
3.3.2. Egypt to cumulatively allocate US$3.3 billion towards defense capital expenditure (excluding US Aid) over the forecast period
3.3.3. Per capita defense expenditure to increase over the forecast period
3.3.4. Egypt considered at a ‘high risk’ of a terrorist attack
3.3.5. Egypt faces moderate threats from terrorist organizations
3.3.6. Egypt has a terrorism index score of 7.2
3.4. Benchmarking with Key Global Markets
3.4.1. Egyptian defense expenditure expected to grow at a faster pace during 2018-2022
3.4.2. Egypt has a relatively small defense budget
3.4.3. Egypt allocates 1.2% of its GDP to defense
3.5. Market Opportunities: Key Trends and Growth Stimulators
3.5.1. Top 10 Defense Market Sectors by Value (US$ Million) - Projections over 2018-2023
3.5.2. Fighters and Multirole Aircraft
3.5.3. Land-based C4ISR
3.5.4. Airborne C4ISR
4. Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Defense imports driven by regional security dynamics
4.1.2. France was the leading supplier of arms to Egypt during the historic period
4.1.3. Aircraft and naval vessels dominate defense imports
4.2. Export Market Dynamics
4.2.1. Defense exports from Egypt were negligible during the historic period
5. Industry Dynamics
5.1. Five Forces Analysis
5.1.1. Bargaining Power of Supplier: High
5.1.2. Bargaining Power of Buyer: Low
5.1.3. Barrier to Entry: Medium to High
5.1.4. Intensity of Rivalry: Low to Medium
5.1.5. Threat of Substitution: Medium
6. Market Entry Strategy
6.1. Market Regulation
6.1.1. Egypt has not disclosed any offset obligation
6.1.2. Defense procurements lack legitimate procurement laws
6.2. Market Entry Route
6.2.1. Budgeting Process
6.2.2. Procurement Policy and Process
6.2.3. Government-to-government agreements are the preferred market entry route for foreign OEMs
6.2.4. Technology transfer and license manufacturing agreements provide an attractive market entry route
6.3. Key Challenges
6.3.1. Lack of transparency and corruption
6.3.2. Political uncertainty and internal instability discourages foreign participation
6.3.3. Stalled EU military aid may affect the defense industry
7. Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.1.1. Egyptian defense industry is predominantly state-run
7.2. Key Domestic Companies
7.2.1. Abu Zaabal Tank Repair Factory: Overview
7.2.2. Abu Zaabal Tank Repair Factory: Products and Services
7.2.3. Abu Zaabal Tank Repair Factory: Recent Announcements and Strategic Initiatives
7.2.4. Arab Organization for Industrialization - Engine Factory: Overview
7.2.5. Arab Organization for Industrialization - Engine Factory: Products and Services
7.2.6. Arab Organization for Industrialization - Aircraft Factory: Overview
7.2.7. Arab Organization for Industrialization - Aircraft Factory: Products and Services
7.2.8. Arab Organization for Industrialization - Sakr Factory: Overview
7.2.9. Arab Organization for Industrialization - Sakr Factory: Products
7.2.10. Arab Organization for Industrialization - Kader Factory: Overview
7.2.11. Arab Organization for Industrialization - Kader Factory: Products
7.2.12. Arab Organization for Industrialization - Electronics Factory: Overview
7.2.13. Arab Organization for Industrialization - Electronics Factory: Products
7.2.14. Arab British Dynamics Company: Overview
7.2.15. Arab British Dynamics Company: Products
7.2.16. Helwan Factory for Developed Industries: Overview
7.2.17. Helwan Factory for Developed Industries: Services
7.3. Key Foreign Companies
7.3.1. Lockheed Martin: Overview
7.3.2. Lockheed Martin: Products
7.3.3. Lockheed Martin: Recent Announcements and Strategic Initiatives
7.3.4. Lockheed Martin: Alliances
7.3.5. Lockheed Martin: Recent Contract Wins
7.3.6. Lockheed Martin: Financial Analysis
7.3.7. General Dynamics Corporation: overview
7.3.8. General Dynamics Corporation: Products
7.3.9. General Dynamics Corporation: Alliances
7.3.10. General Dynamics Corporation: Recent Contract Wins
7.3.11. Sikorsky Aircraft Corporation: Overview
7.3.12. Sikorsky Aircraft Corporation: Products
7.3.13. Sikorsky Aircraft Corporation: Recent Announcements and Strategic Initiatives
7.3.14. Sikorsky Aircraft Corporation: Alliances
7.3.15. Sikorsky Aircraft Corporation: Recent Contract Wins
7.3.16. Boeing: Overview
7.3.17. Boeing: Products
7.3.18. Boeing: Recent Announcements and Strategic Initiatives
7.3.19. Boeing: Alliances
7.3.20. Boeing: Recent Contract Wins
7.3.21. Boeing: Financial Analysis
7.3.22. Dassault Aviation: Overview
7.3.23. Dassault Aviation: Products
7.3.24. Dassault Aviation: Recent Announcements and Strategic Initiatives
7.3.25. Dassault Aviation: Alliances
7.3.26. Dassault Aviation: Recent Contract Wins
7.3.27. Dassault Aviation: Financial Analysis
7.3.28. Thales: Overview
7.3.29. Thales: Products and Services
7.3.30. Thales: Recent Announcements and Strategic Initiatives
7.3.31. Thales: Alliances
7.3.32. Thales: Recent Contract Wins
7.3.33. Thales: Financial Analysis
7.3.34. Naval Group: Overview
7.3.35. Naval Group: Products and Services
7.3.36. Naval Group: Recent Announcements and Strategic Initiatives
7.3.37. Naval Group: Alliances
7.3.38. Naval Group: Recent Contract Wins
7.3.39. United Aircraft Corporation: Overview
7.3.40. United Aircraft Corporation: Products
7.3.41. United Aircraft Corporation: Recent Announcements and Strategic Initiatives
7.3.42. United Aircraft Corporation: Alliances
7.3.43. United Aircraft Corporation (UAC): Recent Contract Awards
7.3.44. United Aircraft Corporation (UAC): Financial Analysis
7.3.45. Uralvagonzavod: Overview
7.3.46. Uralvagonzavod: Products
7.3.47. Uralvagonzavod: Recent Announcements and Strategic Initiatives
7.3.48. Uralvagonzavod: Alliances
7.3.49. Uralvagonzavod: Recent Contract Wins
8. Business Environment and Country Risk
8.1. Economic Performance
8.1.1. Gross Domestic Product Per Capita
8.1.2. Gross Domestic Product (Current US$ Billion)
8.1.3. Exports of Goods and Services
8.1.4. Imports of Goods and Services
8.1.5. Gross National Disposable Income
8.1.6. LCU per USD (Period Average)
8.1.7. Market Capitalization of Listed Companies (US$ Billion)
8.1.8. Market Capitalization of Listed Companies (Percentage of GDP)
8.1.9. Government Cash Surplus/Deficit as a Percentage of GDP (LCU)
8.1.10. Goods Exports as a Percentage of GDP
8.1.11. Goods Imports as a Percentage of GDP
8.1.12. Service Imports as a Percentage of GDP
8.1.13. Service Exports as a Percentage of GDP
8.1.14. Foreign Direct Investment, Net (BoP, Current US$ Billion)
8.1.15. Foreign Direct Investment as a Percentage of GDP
8.1.16. Mining, Manufacturing, Utilities Output (LCU Bn)
9. Appendix
9.1. About SDI
9.2. Disclaimer
List of Tables
Table 1: Egypt - Army Strength, 2018
Table 2: Egypt - Air Force Strength, 2017
Table 3: Egypt - Navy Strength
Table 4: Egypt - Ongoing Development and Procurement Programs, 2017
Table 5: Egypt - Future Procurement Programs, 2017
Table 6: Egypt - Top Defense Procurement Programs by Value (US$ Million), 2018-2023
Table 7: Egypt - Defense Expenditure Including US Aid, 2014-2023
Table 8: Egypt - Defense Expenditure (EGP Billion & US$ Billion), 2014-2023
Table 9: Egypt’s GDP Growth vs Defense Expenditure as a Percentage of GDP, 2014-2023
Table 10: Egypt - Defense Budget Allocation for Capital and Revenue Expenditure (%), 2014-2023
Table 11: Egypt - Defense Capital Expenditure, Excluding US Aid (EGP Billion & US$ Billion), 2014-2023
Table 12: Egypt - Defense Expenditure as Per Capita Defense Spend (US$), 2014-2023
Table 13: Terrorism Index, 2018
Table 14: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023
Table 15: Top 10 Egyptian Defense Market Sectors by Value (US$ Million), 2018-2023
Table 16: Egyptian Budget Formation Timetable
Table 17: Competitive Landscape of the Egyptian Defense Industry
Table 18: Top Defense Suppliers in the Egyptian Defense Industry - By Value (US$ Million) 2018-2023
Table 19: Abu Zaabal Tank Repair Factory - Products and Services
Table 20: Arab Organization for Industrialization - Engine Factory - Products and Services
Table 21: Arab Organization for Industrialization - Aircraft Factory - Products and Services
Table 22: Arab Organization for Industrialization - Sakr Factory - Products
Table 23: Arab Organization for Industrialization - Kader Factory - Products
Table 24: Arab Organization for Industrialization - Electronics Factory - Products
Table 25: Arab British Dynamics Company - Products
Table 26: Helwan Factory for Developed Industries - Services
Table 27: Lockheed Martin - Products
Table 28: Lockheed Martin - Alliances
Table 29: Lockheed Martin - Recent Contract Wins
Table 30: General Dynamics Corporation - Products
Table 31: General Dynamics Corporation - Alliances
Table 32: General Dynamics Corporation - Recent Contract Wins
Table 33: Sikorsky Aircraft Corporation - Products
Table 34: Sikorsky Aircraft Corporation - Alliances
Table 35: Sikorsky Aircraft Corporation - Recent Contract Wins
Table 36: Boeing - Products
Table 37: Boeing - Alliances
Table 38: Boeing - Recent Contract Wins
Table 39: Dassault Aviation - Products
Table 40: Dassault Aviation - Alliances
Table 41: Dassault Aviation - Recent Contract Wins
Table 42: Thales - Products and Services
Table 43: Thales - Alliances
Table 44: Thales - Recent Contract Wins
Table 45: Naval Group - Products and Services
Table 46: Naval Group - Alliances
Table 47: Naval Group - Recent Contract Wins
Table 48: United Aircraft Corporation - Products
Table 49: United Aircraft Corporation - Alliances
Table 50: United Aircraft Corporation (UAC) - Recent Contract Wins
Table 51: Uralvagonzavod - Products
Table 52: Uralvagonzavod - Alliances
Table 53: Uralvagonzavod - Recent Contract Wins
List of Figures
Figure 1: Egypt - US Military Aid (US$ Billion), 2014-2023
Figure 2: Egypt - Defense Expenditure Including US Aid (US$ Billion), 2014-2023
Figure 3: Egypt - Defense Budget Excluding US Aid (US$ Billion) vs Defense Budget Including US Aid (US$ Billion), 2014-2023
Figure 4: Egypt - Defense Budget (EGP Billion), 2014-2023
Figure 5: Egypt - Defense Budget (US$ Billion), 2014-2023
Figure 6: Egypt’s GDP Growth vs Defense Expenditure as a Percentage of GDP, 2014-2023
Figure 7: Egypt - Defense Budget Allocation for Capital and Revenue Expenditure (%), 2014-2023
Figure 8: Egypt - Defense Capital Expenditure, Excluding US Aid (EGP Billion), 2014-2023
Figure 9: Egypt - Defense Capital Expenditure, Excluding US Aid (US$ Million), 2014-2023
Figure 10: Egypt -Defense Expenditure as Per Capita Defense Spend (US$), 2014-2023
Figure 11: Terrorism Heat Map, 2018
Figure 12: Terrorism Index, 2018
Figure 13: Benchmarking with Key Markets - 2014-2018 vs. 2019-2023
Figure 14: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2018 and 2023
Figure 15: Countries with the Largest Defense Expenditure as a Percentage of GDP (%), 2018
Figure 16: Egyptian Fighters and Multirole Aircraft Market Size (US$ Million), 2018-2023
Figure 17: Egyptian Land-based C4ISR Market Size (US$ Million), 2018-2023
Figure 18: Egyptian Airborne C4ISR Market Size (US$ Million), 2018-2023
Figure 19: Top Egyptian Defense Procurements in Terms of Their Supplier Relationships
Figure 20: Egypt - Defense Imports Trend (US$ Million), 2013-2017
Figure 21: Egypt - Defense Imports by Country (%), 2013-2017
Figure 22: Egypt - Imports by Weapons Type (%), 2013-2017
Figure 23: Egypt - Defense Industry Dynamics
Figure 24: Lockheed Martin - Revenue Trend Analysis (US$ Billion), 2013-2017
Figure 25: Lockheed Martin - Operating Profit Trend Analysis (US$ Billion), 2013-2017
Figure 26: Lockheed Martin - Net Profit Trend Analysis (US$ Billion), 2013-2017
Figure 27: Boeing - Revenue Trend Analysis (US$ Billion), 2013-2017
Figure 28: Boeing - Operating Profit Trend Analysis (US$ Billion), 2013-2017
Figure 29: Boeing - Net Profit Trend Analysis (US$ Billion), 2013-2017
Figure 30: Dassault Aviation - Revenue Trend Analysis (EUR Billion), 2013-2017
Figure 31: Dassault Aviation - Operating Profit Trend Analysis (EUR Million), 2013-2017
Figure 32: Dassault Aviation - Net income Trend Analysis (EUR Million), 2013-2017
Figure 33: Thales - Revenue Trend Analysis (EUR Billion), 2013-2017
Figure 34: Thales - Operating Profit Trend Analysis (EUR Million), 2013-2017
Figure 35: Thales - Net Profit Trend Analysis (EUR Million), 2013-2017
Figure 36: United Aircraft Corporation (UAC) - Revenue Trend Analysis (RUB Billion), 2012-2016
Figure 37: United Aircraft Corporation (UAC) - Operating Profit Trend Analysis (RUB Billion), 2012-2016
Figure 38: United Aircraft Corporation (UAC) - Net Profit Trend Analysis (RUB Billion), 2012-2016
Figure 39: Egyptian GDP Per Capita (In US$), 2015-2025
Figure 40: Egyptian GDP (Current Prices US$ Billion), 2015-2025
Figure 41: Egyptian Exports of Goods and Services (Current Prices, LCU Billion), 2005-2014
Figure 42: Egyptian Imports of Goods and Services (Current Prices, LCU Billion), 2004-2013
Figure 43: Egyptian Gross National Disposable Income (US$ Billion), 2007-2012
Figure 44: Egyptian LCU per USD (Period Average), 2015-2024
Figure 45: Egyptian Market Capitalization of Listed Companies (US$ Billion), 2005-2012
Figure 46: Egyptian Market Capitalization of Listed Companies (Percentage of GDP), 2005-2012
Figure 47: Egyptian Government Cash Surplus/Deficit as a Percentage of GDP (LCU), 2005-2012
Figure 48: Egyptian Goods Exports as a Percentage of GDP, 2005-2014
Figure 49: Egyptian Goods Imports as a Percentage of GDP, 2005-2014
Figure 50: Egyptian Service Imports as a Percentage of GDP, 2005-2014
Figure 51: Egyptian Service Exports as a Percentage of GDP, 2005-2014
Figure 52: Egyptian Foreign Direct Investment, Net (BoP, Current US$ Billion), 2005-2014
Figure 53: Egyptian Foreign Direct Investment as a Percentage of GDP, 2005-2014
Figure 54: Egyptian Mining, Manufacturing, Utilities Output (LCU Bn), 2005-2014

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