Spain Defence and Security Report Q2 2011
Business Monitor International, April 2011, Pages: 109
Spain Defence and Security Report provides industry professionals and strategists, corporate analysts, defence and security associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Spain's defence and security industry.
The tough reforms pushed through by Prime Minister Zapatero over the course of 2010 may well have saved Spain the same humiliation witnessed in other peripheral European countries, namely Greece and Ireland. However, these have placed great stress on the nation’s finances, and as has become the norm throughout the rest of Europe, this has led to a sharp curtailing of military spending. This has caused further accusations from both NATO and the US that European nations are not pulling their weight in the trans-Atlantic alliance, with nations failing to spend the mandated 2% of GDP on defence. Spain has been seen as a particular culprit of this, with around a 9% reduction in the budget of the MoD over the course of 2010 and 1.2% of GDP spent on defence.
However, this process may actually leave both the expeditionary capacity and defence industries of Europe, and so Spain, in a stronger position. One need only look at the 2010 cooperation agreements between France and Britain to see that it is almost inevitable that there will be further defence integration across Europe in the coming years. This would certainly begin to bring to bear the weight which Europe as a whole should be able to bring to the NATO table.
As well as this, cooperation of European defence industry has deepened. While EADS did not win the much vaunted US$35bn air refuelling contract, its long term contention for the project is indicative of the flexibility and strength of the organisation. Additionally, it seems likely that EADS will challenge the contract decision, as has happened twice before in the history of this project. With the potential for follow on contracts worth up to US$100bn, it would appear that whoever eventually does take control of this would be the largest Aerospace company in the US by far.
A combination of both what appears to be an arms race in South Asia, compounded with a slowdown in procurement spending in the region after the economic turmoil of the 1990s, has also offered what looks to be a saving grace to the industry over the course of 2011. In particular, the growth of Chinese military spending (as well as the unveiling of some new defence projects, notably what appears to be a fifth generation stealth fighter and the potential to target carrier groups well beyond what has been traditionally assumed) and an unstable and unpredictable North Korea, stand to highlight new necessities for those wishing to be regional military players. Of particular headline note is the contract for fighter aircraft to the Indian Airforce, in which the Eurofighter is currently being viewed as a leader.
The deal is thought to be worth US$11bn and relates to 126 aircraft. The purchase would be of such a size that India would be at least considered a partner of the project, and would probably actually become one, the Financial Times reported in November. However, high-level visits have been made to New Delhi from Russia, America and France, to promote their weapons platforms as well. If the Eurofighter does win the contract, then EADS would open a new facility in Bangalore, which may act as a sweetener to the deal.
Domestically, ETA continues in its recent vein of a non military engagement. Whilst there has been talk of a revamped separatist movement seeking to act as political representatives throughout the Basque country, with a new party, Sortu, being founded. There is widespread belief that this organisation will be banned by Federal court, as it is believed that it is merely a rebranded Batasuna party. Batasuna was banned from competing in elections in 2003, due to being viewed merely as an extension of ETA.
Executive Summary
SWOT Analysis
Spain Security SWOT
Spain Defence Industry SWOT
Spain Political SWOT
Spain Economic SWOT
Spain Business Environment SWOT
Global Political Outlook
The United States
China
Japan And The Koreas
Russia
Europe
India
Brazil
Turkey
Iran
Egypt, Saudi Arabia And Pakistan
Terrorism
Africa
Space
Competition
Wild Card In Global Politics
Conclusion
Europe Security Overview
The Strategic Outlook For The 2010s
Security Risk Analysis
BMI’s Security Ratings
Table: Europe Security Risk Ratings
Table: Europe State Terrorism Vulnerability To Terrorism Index
Spain’s Security Risk Ratings
City Terrorism Rating
Table: BMI’s Western Europe City Terrorism Index
Political Overview
Domestic Politics
Long-Term Political Outlook
Domestic Security Overview
Domestic Terrorism
Table: Background Brief – ETA
Timeline: Internal Threats
International Terrorism
Latest Developments
Timeline: External Threats
Armed Forces And Government Spending
Armed Forces
Defence Posture
Defence Reform
International Deployments
Table: Spain’s Foreign Deployments
Coordination And Joint Operations
Weapons Of Mass Destruction
Market Structure
Arms Trade Overview
Timeline: Defence And Procurement
Industry Forecast Scenario
Armed Forces
Table: Spain’s Armed Forces, 2000-2008 (‘000 personnel, unless otherwise stated)
Table: Manpower Available For Military Services, 2008-2015 (aged 16-49, unless otherwise stated)
Government Expenditure On Defence Industry
Table: Government Defence Expenditure, 2008-2015
Table: Expenditure Scenario – Changing % Of GDP, 2008-2015 (US$mn)
Defence Trade
Table: Defence Exports, 2008-2015 (US$mn) )
Table: Defence Imports, 2008-2015 (US$mn)
Table: Defence Trade Balance, 2008-2015 (US$mn)
Macroeconomic Forecast
Table: Spain – Economic Activity, 2008-2015
Company profiles
EADS CASA
General Dynamics Santa Bárbara Sistemas
Indra
ITP
Navantia (formerly known as Izar)
Country Snapshot: Spain Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2002-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators, 2001-2006
Table: Consumer Expenditure, 2000-2012 (US$)
Table: Average Annual Manufacturing Wages, 2000-2012
BMI Methodology
How We Generate Our Industry Forecasts
Defence Industry
City Terrorism Rating
Table: Methodology
Sources
- EADS CASA
- General Dynamics Santa Bárbara Sistemas
- Indra
- ITP
- Navantia (formerly known as Izar)
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