Future of the Peruvian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2024

Future of the Peruvian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2024

Summary

The Peruvian defense budget is set to register a CAGR of 2.53% over the forecast period and reach US$2.6 billion in 2024. In 2019, Peru’s defense budget is US$2.3 billion registering a CAGR of 0.57% during the historic period. Active participation in peacekeeping missions, narco-terrorism, and defense sector reforms, the persistent threat from insurgent guerrilla organization Shining Path, border conflicts with Chile, and modernization initiatives drove defense expenditure over the historic period. The defense budget as a percentage of GDP is expected to decrease to an average of 0.84% in the forecast period, compared to an average of 1.04% during the historic period.

The capital expenditure allocation is expected to decrease to an average of 5.8% during the forecast period which stood at an average of 9.9% during the historic period. Procurements that are expected to account for capital expenditure over the forecast period include frigates, multi-role aircraft, submarines, and main battle tanks (MBTs), TGS-MIL & TGM MIL, and BTR-82 APC among others. Consequently, the remaining budget will be allocated to personnel salaries, development programs for military personnel, and training.

Peruvian homeland security (HLS) expenditure is US$3.1 billion in 2019 and is expected to grow at a CAGR of 4.44% over the forecast period to reach US$4.0 billion in 2024. The budget of homeland security will be driven by police reforms and modernization, as well as the need to curb cocaine trafficking and organized crime.

Between 2014 and 2018, South Korea emerged as the largest supplier of military hardware to Peru, with a share of 33.9% of total defense imports, followed by Russia and Italy with 21.8% and 14.0% respectively. Aircraft accounted for the majority of defense imports with a share of 39.5% during the period 2014-2018. During the period 2014-2018, Peru acquired 32 Piranha APC, 16 MM-40-3 Exocet anti-ship SSM, 175 Spike-ERanti tank missile and C-27J Spartan transport aircraft. Other ongoing contracts include TGS and TGM MIL Rheinmetall MAN Military Vehicles and the modernization of four HDW 209/1200-class submarines.

The report "Future of the Peruvian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2024", offers a detailed analysis of the Peruvian 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 defense industry market size and drivers: detailed analysis of the Peruvian defense industry during 2020-2024, 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 Peruvian 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


• Competitive landscape and strategic insights: analysis of the competitive landscape of the Peruvian 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: Los Servicios Industriales de la Marina (SIMA), The Army Ammunition Factory (FAME), Desarrollos Industriales Casanave.

Scope

• In 2019, Peru’s defense budget is US$2.3 billion registering a CAGR of 0.57% during the historic period. Active participation in peacekeeping missions, narco-terrorism, and defense sector reforms, the persistent threat from insurgent guerrilla organization Shining Path, border conflicts with Chile, and modernization initiatives drove defense expenditure over the historic period.


• The country’s defense expenditure is anticipated to value US$2.6 billion in 2024 and register a CAGR of 2.53% over the forecast period. The defense budget as a percentage of GDP is expected to decrease to an average of 0.84% in the forecast period, compared to an average of 1.04% during the historic period.

Reasons to Buy

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