Future of the nigerian defense industry - Reports Corener

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Reports Corner
Future of the Nigerian Defense Industry - Market Attractiveness,
Competitive Landscape and Forecasts to 2018

DescriptionDescription
Reports Cornerwww.reportscorner.com
Product Synopsis
This report is the result of SDI's extensive market and company
research covering the Nigerian defense industry, and provides
detailed analysis of both historic and forecast defense industry
values including key growth stimulators, analysis of the leading
companies in the industry, and key news.

Brief SummaryBrief Summary
Product Synopsis
This report is the result of SDI's extensive market and company
research covering the Nigerian defense industry, and provides detailed
analysis of both historic and forecast defense industry values including
key growth stimulators, analysis of the leading companies in the
industry, and key news.
Introduction and Landscape
Why was the report written?
The Future of the Nigerian Defense Industry - Market Attractiveness,
Competitive Landscape and Forecasts to 2018 offers the reader an
insight into the market opportunities and entry strategies adopted by
foreign original equipment manufacturers (OEMs) to gain market share
in the Nigerian defense industry.

What is the current market landscape and what is changing?
The Nigerian defense market, valued at US$2.3 billion in 2013, is
expected to see a double digit growth rate over the forecast period, to
reach US$4.4 billion by 2018. Piracy, oil smuggling in the Gulf of
Guinea and a contribution to peacekeeping operations are expected to
drive the country's military expenditure to register a growth rate of
13.62% over the forecast period. The growth in military expenditure will
be assisted by the country's stable economic growth over the forecast
period, which will a see rise in defense expenditure as a percentage of
GDP from 0.8% in 2013 to 1.1% in 2018. Nigeria's capital defense
expenditure is expected to increase from 0.4 billion in 2013 to 0.6
billion by 2018, although its share in total expenditure is expected to
decrease from 15% during the review period to 14% over the forecast
period.

Defense equipment such as marine helicopters, fighters, patrol
vessels, and armored personnel carriers are expected to be demand
over the forecast period. An under developed domestic defense
industry and availability of funds propel the Nigerian government to
import from the countries producing low-cost defense equipment. The
growing threat from Boko Haram and other extremist groups in
northeastern states, and drug trafficking are expected to drive the
Nigerian government's investments in homeland security over the
forecast period. Police modernization and homeland security
infrastructure developments are expected to be primary areas for
investment by the government.
What are the key drivers behind recent market changes?
Nigerian military expenditure is expected to be mainly driven by
peacekeeping operations and efforts to stop the smuggling of stolen oil.

What makes this report unique and essential to read?
The Future of the Nigerian Defense Industry - Market Attractiveness,
Competitive Landscape and Forecasts to 2018 provides detailed
analysis of the current industry size and growth expectations from 2014
to 2018, including highlights of key growth stimulators. It also
benchmarks the industry against key global markets and provides a
detailed understanding of emerging opportunities in specific areas.
Key Features and Benefits
The report provides detailed analysis of the current industry size and
growth expectations from 2014 to 2018, including highlights of key
growth stimulators, and also benchmarks the industry against key
global markets and provides a detailed understanding of emerging
opportunities in specific areas.

The report includes trend analysis of imports and exports, together with
their implications and impact on the Nigerian defense industry.
The report covers five forces analysis to identify various power centers
in the industry and how these are expected to develop in the future.
The report allows readers to identify 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.
The report helps the reader to understand the competitive landscape of
the defense industry in Nigeria. It provides an overview of key defense
companies, both domestic and foreign, together with insights such as
key alliances, strategic initiatives, and a brief financial analysis.

Key Market Issues
According to the Corruption Perceptions Index 2010 of Transparency
International, Nigeria is classified as a highly corrupt country.
Corruption can result in unfair contract awards and has become a
major obstacle for foreign companies aiming to supply arms to the
Nigerian MoD. There is also widespread corruption in the Nigerian
Police Force; embezzlement and mismanagement of the police budget
has resulted in only a small portion of the budget being spent on
protecting internal security, resulting in an increased internal threat to
the country. In January 2008 the Chief of Army Staff, acting for and on
behalf of the government of Nigeria, awarded contracts to Esquire
Ventures Ltd., Profitel Ltd., Century Communications Ltd., and Jonny-
Way Investments Ltd., for the supply of various specialist military items
to be used by Nigeria's UN-backed troops, for NGN1,190.7 million
(US$10.3 million).

Materials valued at NGN660 million (US$5.7 million) were supplied and
others worth NGN530.7 million (US$4.6 million) were ready for
shipment, but the contractors were paid only NGN175 million (US$1.5
million), leaving the contractors underpaid, despite the country
receiving funding for the project from the UN worth several million
dollars. Issues such as this are causing the Ministry of Defense and
Nigerian Police to maintain a high level of focus on anti-corruption
activities.
With a defense budget of US$2.3 billion in 2013, Nigeria invests only
0.8% of its GDP towards defense. During the review period an average
of 14.9% of the defense budget was allocated for capital expenditure,
representing a relatively low allocation for the purchase of equipment
and high-technology arms and ammunition. As a result, the country's
relatively small defense budget does not attract foreign defense

companies, and the prohibition of FDI in the defense sector also acts
as a barrier for market entry for foreign suppliers.
Key Highlights
Nigeria is the largest crude oil producer in Africa and generates about
80% of its revenues from oil exports. However, the country is plagued
by piracy and oil theft, so loses about 10% of its oil exports. The
expanding activities of criminal gangs have caused an upsurge in the
number of oil ships attacked by the Nigerian pirates in Gulf of Guinea in
the last two years. Pirates not only hold the ship and crew for ransom,
but also strip the vessel of oil and other valuable items. A lack of
stringent security measures in Gulf of Guinea and along its borders has
also accentuated the threat of oil theft, which cripples the country's
economy.

In 2011, Nigerian soldiers destroyed nearly 500 illegal oil refineries in
the Niger Delta region to stop the smuggling of stolen oil in the country.
Recently, Nigeria had to withdraw its peacekeeping contingent form
Darfur to counter the threat from oil smugglers in around of Niger Delta.
The Nigerian government is expected to spend on strengthening its
Navy and maritime patrol to deal with oil smugglers and procure
necessary equipment over the forecast period. Nigeria's Navy is
seeking government approval to acquire up to 49 ships and 42
helicopters over the next ten years to guard the nation's territorial
waterways and Gulf of Guinea.
Nigeria has a long history of internal conflicts marring its economic
growth and stability. Although these conflicts have ethnic and religious
connotations to them, the divisions have deeper reasons such as
struggles for control over the oil.

The recent emergence of the radical Islamic group, Boko Haram flared
up the rebellion in northeast Nigeria leading to the announcement of
emergency in these states by the President in May. Boko Haram is
believed to be behind the kidnappings of foreign nationals for ransom
and subsequent killings in the past two years. Nigerian government
suspects that Boko Haram's leadership has ties with Al Qaeda in the
Islamic Maghreb (AQIM) and other international terrorist groups; these
suspicions have become stronger due to the sophisticated weaponery
used by the Boko Haram during the conflict with Nigerian Army prior to
the emergency declaration. The Nigerian government passed its first
anti-terrorism act in February 2011, and is also expected to invest in
surveillance and intelligence technologies to counter the threat posed
by these extremist groups. Nigeria is expected to modernize its police
force to enable them to handle the threats posed by these extremist
groups armed with sophisticated equipment.

Nigeria's defense imports peaked in 2010 due to the import of aircraft
from China and fell back to 2009 levels during 2011. The sudden
increase in imports in 2010 is primarily due to the import of 15 F-7
aircraft from China. During the forecast period, imports of defense
equipment are expected to rise further as the country plans to increase
its defense expenditure and spend more on equipment purchases. The
underdeveloped domestic defense market will also lead to a rise in total
defense equipment purchases during the forecast period.

Table of ContentsTable of Contents
1 Introduction
1.1. What is this Report About?
1.2. Definitions
1.3. Summary Methodology
1.4. SDI Terrorism Index
1.5. About Strategic Defence Intelligence
2 Executive Summary
3 Market Attractiveness and Emerging Opportunities
3.1. Defense Market Size Historical and Forecast
3.1.1. Defense expenditure is projected to grow at a CAGR of 13.62% during the forecast period
3.1.2. Piracy, Oil smuggling and peacekeeping operations are expected to drive defense expenditure
3.1.3. Defense budget as a percentage of GDP expected to average 1.0% over the forecast period
3.2. Analysis of Defense Budget Allocation
3.2.1. Share of Revenue expenditure expected to increase over the forecast period
3.2.2. Capital expenditure budget expected to decline during the forecast period

3.2.3. Allocation for the Army accounts for the majority of the defense budget
3.2.4. Army expenditure to grow at a CAGR 14.31% over the forecast period
3.2.5. Naval expenditure to grow at a faster pace over the forecast period
3.2.6. Expenditure on the Air Force to increase during the forecast period
3.2.7. Allocation for other expenses to decline during the forecast period
3.2.8. Per-capita defense expenditure expected to increase during the forecast period
3.3. Homeland Security Market Size and Forecast
3.3.1. Homeland security budget projected to increase during the forecast period
3.3.2. Boko Haram threat, drug trafficking, cybercrime, and money laundering to drive the homeland
security market
3.3.3. Nigeria comes under 'moderately affected category' by terrorist attack
3.3.4. Nigeria experienced moderate terror activity during the review period
3.4. Benchmarking with Key Global Markets
3.4.1. The country's defense budget expected to increase during the forecast period
3.4.2. Nigerian military expenditure is limited compared to countries with the largest defense expenditure

3.4.3. The country allocates a lower percentage of GDP to defense
3.5. Market Opportunities: Key Trends and Growth Stimulators
3.5.1. Fighters and Multi-role Aircraft
3.5.2. Police Modernization
3.5.3. Marine Helicopters
3.5.4. Homeland Security Infrastructure
4 Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Limited defense capability of domestic defense market drives imports
4.1.2. Defense imports expected to increase during the forecast period
4.1.3. China, the US and Italy account for the majority of the country's defense imports
4.1.4. Aircraft and ships are the largest imported military hardware
4.2. Export Market Dynamics
4.2.1. Nigeria does not export arms due to its under-developed domestic arms industry

6.3.2. Small defense budget does not attract suppliers
7 Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.2. Key Domestic Companies
7.2.1. Dornier Aviation Nigeria AIEP Limited: overview
7.2.2. Dornier Aviation Nigeria AIEP Limited: products and services
7.2.3. Defence Industries Corporation of Nigeria: overview
7.2.4. Defence Industries Corporation of Nigeria: products and services
7.2.5. Defence Industries Corporation of Nigeria: recent announcements and strategic initiatives
7.2.6. Defence Industries Corporation of Nigeria: alliances
7.2.7. Defence Industries Corporation of Nigeria: recent contract awards
8 Business Environment and Country Risk
8.1. Demographics and Social Statistics
8.1.1. Population - Rural
8.1.2. Population - Urban

8.1.3. Population - Number of Households
8.2. Economic Performance
8.2.1. Gross Domestic per Capita
8.2.2. Gross Domestic Product, current US$
8.2.3. Exports of Goods and Services
8.2.4. Imports of Goods and Services
8.2.5. Manufacturing Output
8.2.6. Consumer Price Index
8.2.7. Local Currency Unit per US$
8.2.8. Local Currency Unit per EUR
8.2.9. Lending Rate (%)
8.2.10. Deposit Rate (%)
8.2.11. Real Interest Rate (%)
8.2.12. Real Interest Rate (%)
8.2.13. Market Capita (%)

8.2.14. Goods Exports as a % of GDP
8.2.15. Goods Imports as a % of GDP
8.2.16. Goods Trade Surplus/Deficit as a % of GDP
8.2.17. Services Imports as a % of GDP
8.2.18. Services Exports as a % of GDP
8.2.19. Services trade surplus/deficit as a % of GDP
8.2.20. Net Foreign Direct Investment
8.2.21. Net FDI as a percentage of GDP
8.2.22. International reserves, including Gold
8.3. Energy and Utilities
8.3.1. Total Conventional Thermal Electricity Net Generation
8.3.2. Hydroelectricity Net Generation
8.3.3. Nuclear Electricity Net Generation
8.3.4. Total Conventional Thermal Electricity Installed Capacity
8.3.5. Proved Reserves of Natural Gas (Trillion Cubic Feet)

8.3.6. Total Petroleum Consumption
8.3.7. Crude Oil Proved Reserves (Billion Barrels)
8.4. Infrastructure Quality and Availability
8.4.1. Air Transport, freight (million ton-km)
8.5. Telecommunication
8.5.1. Telephone lines
9 Appendix
9.1. About SDI
9.2. Disclaimer

For more informationFor more information
For more information please visit our website
https://www.reportscorner.com/reports/27222/Future-of-the-Nigerian-Defense-
Industry---Market-Attractiveness,-Competitive-Landscape-and-Forecasts-to-2018/

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