Future of the georgian defense industry market attractiveness, competitive landscape and forecasts to 2018 - Reports Corner

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Future of the Georgian Defense Industry - Market Attractiveness,
Competitive Landscape and Forecasts to 2018

DescriptionDescription
Reports Cornerwww.reportscorner.com
This report is the result of SDI’s extensive market and company
research covering the Georgian 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 Georgian 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 Georgian 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 a market share in the Georgian
defense industry.

What is the current market landscape and what is changing?
Georgian defense expenditure increased at a CAGR of 6.03%
during the review period and valued US$-7.19 billion in 2013. The
focus of the Georgian government will be on counter terrorism
activities, modernization programs and threats posed by Russia.
What are the key drivers behind recent market changes?
NATO membership, threats posed by Russia and Terrorism and
modernization plans are the major drivers of the Georgian defense
industry
What makes this report unique and essential to read?
The Future of the Georgian 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 Georgian
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 Georgia. 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
Russia, being the main trading partner of Georgia started
imposing embargoes since 2005. It started with restricting entry of
agricultural produce and then targeted the main industries like
mineral water and wine. In August 2008 Georgia fought a war with
its separatist regions, South Ossetia and Abkhazia, which gained
complete de facto control of their territories with the help of
Russian forces. When the war ended, Russia proposed an arms
embargo against Georgia, which is currently under review by the
UN. This has restricted the entry of other nations to cater to the
requirement by the Georgian Defense industry in order to maintain
cordial relationship with Russia It’s military power is also an
important factor, as foreign countries want to maintain cordial
relations with Russia. Israel, for example, which had been an
exporter of arms to Georgia, stopped doing so when Russia
began exporting advanced equipment to Iran and Syria,

both of which have conflicting relations with Israel.]
Georgia’s defense budget is small and does not attract many
companies. The country’s budget reached its peak in 2008, at
US$945.95 million. During the review period, an average of 23% of
the defense budget was allocated for capital expenditure on
defense equipment. This small size of the budget does not attract
many companies to supply arms to, or invest in, the country. The
proposed arms embargo against Georgia further increases the
challenges, as defense contractors might not find it feasible to
violate the embargo to cater for a small market.
Key Highlights
The domestic defense industry of Georgia is undeveloped and is
mainly dependent on imports for its arms requirements.

Foreign defense companies can directly sell defense equipment to
the Georgian Defense Ministry, either through direct commercial
sales (DCS) or foreign military sales (FMS). Georgia received arms
from the US prior to the proposal of the arms embargo on the
country. During 2002–2006 the country received arms worth
US$77.5 million through DCS and US$82.2 million through FMS.
Historically, FMS and DCS have been the most effective entry
routes to cater to the Georgian markets.
With FDI playing an important role in boosting the economy in
Georgia, avenues in defense are also open, subject to approval
from the Georgian Parliament. The policy which allows full profit
proliferation acts as a booster for foreign investors. Foreign
defense companies can enter the Georgian defense market by
establishing subsidiaries, and maintenance and support facilities
in Georgia to manufacture defense equipment.

There is an urgent need for investment in the sector for achieving
the objectives of modernization of the army, professional training
to the personnel, technology collaboration and developing the
domestic manufacturing capacity in defense sector. Finding
partners willing to invest in the country’s defense sector,
however, is a challenge.
Ukraine is the key supplier of arms and defense equipment to
Georgia. It is followed by Turkey, Czech Republic, Bulgaria,
Poland and Israel. Post August 2008,, an embargo was proposed
by Russia to UN against Georgia, However, the proposition is still
under review but this has led to many European countries ceasing
its supplies to Georgia in order to maintain peace with, Russia.
The year 2011 and 2012 have seen a slack in the imports primarily
due to the grim economic scenario and others priorities.

The US for the moment has limited its supply of arms to Georgia
to maintain cordial ties with Russia, and to avoid it from supplying
arms onwards to countries such as Iran and Syria. Also, the small
size of Georgia’s defense budget does not attract many countries
to the market. During the forecast period, provided the arms
embargo is not approved by the UN, Ukraine is expected to remain
the largest arms exporter to Georgia

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. Georgian annual defense expenditure to reach US$535.3million by 2018
3.1.2. NATO membership, threats posed by Russia and Counter-Terrorism and modernization plans drive
defense expenditure
3.1.3. Defense expenditure as a percentage of GDP expected to decline
3.1.4. Per-capita defense expenditure expected to reach US$119 by 2018
3.2. Analysis of Defense Budget Allocation

3.2.1. Capital expenditure allocation expected to increase during the forecast period
3.2.2. Capital expenditure budget expected to grow during the forecast period
3.2.3. MoD to spend US$390 million on revenue expenditure during the forecast period
3.3. Homeland Security Market Size and Forecast
3.3.1. Homeland security market expected to grow at a CAGR of 7.00% during the forecast period
3.3.2. Human trafficking, drug trafficking and internal disputes to drive homeland security expenditure
3.3.3. Georgia falls under “some risk” of terrorism category
3.3.4. Georgia has terrorism index score of 0.2
3.3.5. Georgia faces moderate risk of terrorist attack
3.4. Benchmarking with Key Global Markets
3.4.1. Despite a small budget, Georgian defense expenditure will grow faster than leading spenders
3.4.2. Georgia's per capita expenditure is less than its neighbors Russia and Turkey
3.4.3. Georgia is a very small figure in the global defense market
3.4.4. Georgia allocates a higher share of its GDP to defense than NATO requires
3.5. Market Opportunities: Key Trends and Growth Stimulators

3.5.1. Demand for armored vehicles expected to increase
3.5.2. Demand for fighter aircraft and missile defense systems expected to increase
3.5.3. Anti-tank and anti-aircraft capabilities expected to be in demand
3.5.4. Defense and logistics systems to be enhanced to enable informed actions against attack
3.5.5. Specialized training will witness a surge in demand
3.5.6. Demand for air defense equipment to surge
4 Defense Procurement Market Dynamics
4.1. Import Market Dynamics
4.1.1. Defense imports expected to recover by 2018
4.1.2. Ukraine is the major arms supplier to Georgia
4.1.3. Armored vehicles, sensors and missiles account for the majority of Georgia's arms imports
4.2. Export Market Dynamics
4.2.1. Georgia does not export arms due to an undeveloped domestic arms industry
5 Industry Dynamics
5.1. Five Forces Analysis

5.1.1. Bargaining power of supplier: high
5.1.2. Bargaining power of buyer: low
5.1.3. Barriers to entry: high
5.1.4. Intensity of rivalry: low
5.1.5. Threat of substitution: low
6 Market Entry Strategy
6.1. Market Regulation
6.1.1. Georgia does not disclose any offset obligations imposed by the country
6.1.2. FDI in defense sector permitted only after review by the government
6.2. Market Entry Route
6.2.1. Foreign military sales (FMS) and direct commercial sales (DCS) preferred market entry routes
6.2.2. Establishment of subsidiaries provides an alternative entry route
6.3. Key Challenges
6.3.1. Proposed arms embargo against Georgia makes it difficult for defense companies
6.3.2. Small defense budget does not attract investors and suppliers

7 Competitive Landscape and Strategic Insights
7.1. Competitive Landscape Overview
7.2. Key Public Sectors Companies
7.2.1. Tbilisi Aircraft Manufacturing: overview
7.2.2. Tbilisi Aircraft Manufacturing - Major Products and Services
7.2.3. Tbilisi Aircraft Manufacturing: recent contracts and strategic initiatives
7.2.4. Tbilisi Aircraft Manufacturing - Alliances
8 Business Environment and Country Risk
8.1. Demographics and Social Statistics
8.1.1. Total Rural Population
8.1.2. Total Urban Population
8.1.3. Number of households
8.2. Economic Performance
8.2.1. GDP Per Capita
8.2.2. GDP, Current Prices

8.2.3. Consumer Price Index
8.2.4. Wholesale Price Index
8.2.5. Local Currency Unit per Euro
8.2.6. Lending Rate
8.2.7. Real Interest Rate
8.2.8. Market Capitalization of Listed Companies
8.2.9. Market Capitalization of Listed Companies (% of GDP)
8.2.10. Government Cash Surplus/Deficit
8.2.11. Government Cash Surplus/Deficit as % of GDP
8.2.12. Central Government Debt
8.2.13. Central Government Debt as % of GDP
8.2.14. Goods exports as % of GDP
8.2.15. Goods imports as % of GDP
8.2.16. Goods Trade Surplus/Deficit as % of GDP
8.2.17. Service Imports as % of GDP

8.4.1. Rail Lines
8.4.2. Air transport, freight
8.5. Minerals
8.5.1. Mining, Manufacturing, Utilities Output
8.6. Technology
8.6.1. Patents Granted
8.7. Telecommunication
8.7.1. Telephone Lines
8.7.2. Telephone Lines Penetration Rate
8.8. Technology
8.8.1. Fixed Broadband Internet Subscribers
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/21354/Future-of-the-Georgian-Defense-
Industry---Market-Attractiveness,-Competitive-Landscape-and-Forecasts-to-2018/

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Future of the georgian defense industry market attractiveness, competitive landscape and forecasts to 2018 - Reports Corner

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Future of the georgian defense industry market attractiveness, competitive landscape and forecasts to 2018 - Reports Corner