Insights Into the Portuguese Defense Market 2019-2024 - International Peacekeeping Operations Expected to Drive Defense Expenditure - ResearchAndMarkets.com
This report offers detailed analysis of the Portuguese 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.
Select Report Findings
Portugal's military expenditure, which stands at US$2.46 billion in
2019, is anticipated to grow from US$2.53 billion in 2020 to value
US$2.74 billion in 2024, registering a CAGR of 2.03%, over the
forecast period.
The growth will primarily be fueled by the government plans to
completely withdraw austerity reforms over the forecast period, which
is expected to boost the country's economy.
The Portuguese defense budget is anticipated to value US$2.7 billion by
2024, growing at a CAGR of 2.03%. Portugal's military expenditure, which
stands at US$2.46 billion in 2019, is anticipated to grow from US$2.53
billion in 2020 to value US$2.74 billion in 2024, registering a CAGR of
2.03%, over the forecast period. The growth will primarily be fueled by
the government plans to completely withdraw austerity reforms over the
forecast period, which is expected to boost the country's economy.
Military expenditure, on a cumulative basis, is anticipated to be
US$13.1 billion over the forecast period, which is higher than the
US$11.3 billion spent during the historic period. Portugal is an active
participant in joint operations with the European Union (EU) and
peacekeeping operations with NATO and the United Nations (UN), and as
such, seeks higher spending in terms of its defense sector. This, along
with the Military Programming Law (LPM) that the country is anticipated
to undertake over the next coming years, is expected to drive Portugal's
defense expenditure over the forecast period.
Over the forecast period, the country's capital expenditure allocation
is expected to average 18.6%, and revenue expenditure is expected to cap
at an average of 81.4%. Capital expenditure over the forecast period is
expected to increase at a CAGR of 2.04%, from US$471.1 million in 2020
to US$510.7 million in 2024. This is owing to the significant uptick in
weapon procurement plans, as well as procuring defense equipment to
replace outdated ones. For instance, Portugal is procuring 6 Agusta
Westland AW119 Koala helicopters, 6 Viana do Castelo OPVs and one
multi-role vessel, 47 4x4 Tactical Communications Vehicles, apart from
procuring the country is also modernization its Black Shark Heavyweight
Torpedoes, Tridente Class Attack Submarines.
The Portuguese homeland security expenditure valued US$2.5 billion in
2020 and is expected to grow at a CAGR of 2.54% to reach US$2.8 billion
in 2024, over the forecast period. This expenditure is primarily driven
by Portugal's focus on enhancing its defense capabilities to counter the
increasing rate of cyber-attacks and securing the country's maritime
borders. The HLS budget is anticipated to be invested in the procurement
of tablets, PDAs, offshore patrol vessels, biometric systems, and other
advanced technology systems to strengthen its internal security forces.
In particular, the report provides an in-depth analysis of the
following:
The defense industry market size and drivers: detailed analysis of the
Portuguese 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 Portuguese 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 Portuguese defense industry. It provides
an overview of key players, together with insights such as key
alliances, strategic initiatives, and a brief financial analysis
Defense Market Size Historical and Forecast
Portuguese defense budget is expected to record a CAGR of 2.03% over
the forecast period
International peacekeeping operations expected to drive defense
expenditure over the forecast period
Portuguese defense expenditure as a percentage of GDP is expected to
decline over the forecast period
Analysis of Defense Budget Allocation
Capital expenditure is expected to account for 18.6% of the defense
budget over 2020-2024
Capital expenditure is anticipated to record a CAGR of 2.04% over the
forecast period
Army is expected to receive the highest allocation over the forecast
period
Army is anticipated to have the major share of expenditure over the
forecast period
Per capita defense expenditure is projected to increase over the
forecast period
Homeland Security Market Size and Forecast
Portuguese homeland security budget anticipated to record a CAGR of
2.54% over the forecast period
Cyber-attacks and maritime security set to drive homeland security
expenditure over the forecast period
Benchmarking with Key Global Markets
Portuguese defense budget expected to remain low compared to the
leading spenders
Portuguese defense expenditure to remain low compared to major
spenders in Europe
Portugal allocates lower share of GDP to defense compared to the US
and other European countries
Opportunities: Key Trends and Growth Stimulators
Top 10 Defense Market Categories by Value (US$ million) -
Forecast-Period Projections
Corvettes MRO
Physical Security
Land-based C4ISR
Import Market Dynamics
Defense imports are expected to increase over 2020-2024
Portugal sourced the majority of its arms imports from Denmark
Naval vessels and armored vehicles accounted for the majority of
military imports
Export Market Dynamics
Defense exports expected to rise during the forecast period
Romania accounted for the majority of Portuguese defense exports
Aircraft are the main exported defense products
Market Entry Strategy
Market Regulation
Offset policy aids development of domestic defense industry and
research activities
Market Entry Route
Budgeting Process
Procurement Policy and Process
Setting up subsidiaries offers a market entry opportunity
Technology transfer, sub-contracts, and long-term supply contracts
open new market entry strategy choices
Key Challenges
Preference for EU companies poses a challenge for other companies
Budget cuts due to austerity measures challenging defense companies
Domestic defense companies facing challenges from foreign companies
Corrupt practices in the Portuguese government challenges the industry
Companies Mentioned
OGMA - IndstriaAeronutica de Portugal S.A.
EID - Empresa de Investigao e Desenvolvimento de Electrnica S.A.