Future of the Malaysian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023
The defense budget of Malaysia for the year 2018 is around US$4 billion, which decreased from US$5 billion in 2014 at a CAGR of about -4.9% during the historic period. One of the major causes for this falling defense budget has been the lower percentage allocation of GDP towards defense sector. Malaysia has also postponed some of its new procurement programs and is increasingly favoring the modernization of its current equipment to cut costs. This is part of attempts being made by the Malaysian government to bring in economic reforms and stabilize the economy. Malaysia has also released its 11th growth plan, wherein plans for achieving economic growth have been well drafted. It is expected that with the implementation of the plans the country’s GDP will rise. The GDP of the country is forecasted to grow at a CAGR of over 9% and reach a value of around US$530 billion by 2023.
The modernization and procurement programs of the armed forces, the country’s participation in UN peacekeeping missions, and territorial disputes with neighboring countries such as Brunei over Limbang, Louisa, and Mariveles, Indonesia over Ambalat, the Philippines over Ardasier and Erica, and Thailand over Ko Kra and Ko Losin, drove the Malaysian defense expenditure during the historic period. With this trend expected to continue over the forecast period, the country is projected to cumulatively spend US$83.9 billion over 2019-2023.
The capital expenditure allocation, which stood at an average of 21% during the historic period, is expected to increase slightly to reach an average of about 21.2% over the forecast period, primarily due to the procurement of aircrafts, corvettes, and armored vehicles. Revenue expenditure is projected to remain at an average of over 78% over the forecast period which will be directed towards additional recruitment, training, and development programs for military personnel.
Malaysia’s homeland security (HLS) budget stands at around US$2.5 billion in 2018, and is estimated to reach about US$2.9 billion by 2023 at a growth rate of over 2.4% over 2019-2023. This expenditure is primarily driven by the need to curb drug smuggling, illegal immigration, and increasing criminal activities in the country.
The report ""Future of the Malaysian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023"" offers detailed analysis of the Malaysian defense industry with market size forecasts covering the next five years.
In particular, it provides an in-depth analysis of the following -
- Market opportunity and attractiveness: detailed analysis of the current industry size and growth expectations during 2019-2023, including highlights of the key growth stimulators. It also benchmarks the industry against key global markets and provides a detailed understanding of emerging opportunities in specific areas.
- Procurement dynamics: trend analysis of imports and exports, together with their implications and impact on the Malaysian defense industry.
- Industry structure: five forces analysis to identify various power centers in the industry and how these are expected to develop in the future.
- Market entry strategy: analysis of possible ways to enter the market, together with detailed descriptions of how existing companies have entered the market, including key contracts, alliances, and strategic initiatives.
- Competitive landscape and strategic insights: analysis of the competitive landscape of the defense industry in Malaysia, providing an overview of key defense companies (both domestic and foreign), together with insights such as key alliances, strategic initiatives, and a brief financial analysis.
- Business environment and country risk: a range of drivers at country level, assessing business environment and country risk. It covers historical and forecast values for a range of indicators, evaluating business confidence, economic performance, infrastructure quality and availability, labor force, demographics, and political and social risk.
Companies mentioned in this report: Leonardo Malaysia, Sukhoi, Denel Land Systems, SME Ordnance Sdn Bhd, SME Aerospace Sdn Bhd, AIROD Sdn Bhd, Boustead Naval Shipyard, Sapura Thales Electronics Sdn Bhd, DRB Hicom Defence Technologies Sdn Bhd, Labuan Shipyard & Engineering Sdn Bhd, D’Aquarian Sdn Bhd.
- The defense budget of Malaysia for the year 2018 is US$4 billion, which decreased from US$5 billion in 2014 at a CAGR of -4.97% during the historic period. - One of the major causes for this falling defense budget has been the lower percentage allocation of GDP towards defense sector.
- Malaysia has also postponed some of its new procurement programs and is increasingly favoring the modernization of its current equipment to cut costs. - This is part of attempts by the Malaysian government to bring in economic reforms and stabilize the economy.
- Malaysia has also released its 11th growth plan, wherein plans for achieving economic growth have been well drafted.
- It is expected that with the implementation of the plans the country’s GDP will rise. The GDP of the country is forecasted to grow at a CAGR of 9.24% and reach a value of US$534.1 billion by 2023.
Reasons to buy
- This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Malaysian 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 Malaysian defense industry covering sections including demand drivers, Key Trends , and latest industry contracts
Learn how to effectively navigate the market research process to help guide your organization on the journey to success.Download eBook