Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022

All the vital news, analysis, and commentary curated by our industry experts.

$1250

Buy Report Download FREE Resources

Published: December 12, 2017 Report Code: GD-DF0449MR-ST

Report Overview
Key Players
Table of Contents
Table
Figures

The Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022, published by Strategic Defense Intelligence, provides readers with detailed analysis of both historic and forecast defense industry values, factors influencing demand, the challenges faced by industry participants, analysis of industry leading companies, and key news.

Synopsis

This report offers detailed analysis of the Venezuelan 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 Venezuelan defense industry market size and drivers: detailed analysis of the Venezuelan defense industry during 2018-2022, 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 Venezuelann 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 over the next 10 years
– Competitive landscape and strategic insights: analysis of the competitive landscape of the Venezuelan defense industry. It provides an overview of key players, together with insights such as key alliances, strategic initiatives, and a brief financial analysis

Scope

– With a defense budget of US$8.6 billion in 2017, Venezuela is amongst the largest arms importers in Latin America and accounts for nearly one-third of the military goods imported in the region. The increasing military expenditure is largely supported by revenues from the world’s largest proven oil reserves in the country. This burgeoning defense expenditure can be attributed to the modernization of the armed forces, re-armament programs, border disputes, and a strong focus on the development of the indigenous military sector.

– The country’s capital expenditure (CAPEX) is anticipated to increase during the forecasted. A number of procurements have fueled growth of the capital budget allocation, including the Shannxi Y-8 transport aircraft, Norinco VN-4 armored vehicles, T-72BIV MBTs (Russian tanks) and BTR-80 armored vehicles, S-125 Pechora-2M SAM systems, Sukhoi fighter jets, 2S23 Nona-SVK self-propelled guns, Stan Patrol 5009 offshore patrol vessels, Stan Patrol 4207 coastal patrol vessels, Enstrom 480 helicopters, and Diamond Aircraft DA40NG Star trainers. Key opportunities for equipment suppliers are expected in areas such as multi-role aircraft, naval vessels, missile systems, surveillance systems, and UAVs.

– The Venezuelan homeland security expenditure is primarily driven by the need to respond to growing threats from organized crime, current civil unrest, and cyber threats. At the same time, a growing economic crisis is expected to cut down HLS expenditure. The country will invest in biometric systems, border protection and training, CCTV systems, electronic surveillance systems, radar systems, and UAVs. Additionally, opportunities in security systems and platforms are expected to arise as a result of the country concentrating on strengthening border security.

Reasons to Buy

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

CA Venezolana de Industrias Militares (CAVIM)
UCOCAR
Diques y Astilleros Nacionales CA (DIANCA)

Table of Contents

1. Introduction 7

1.1. What is this Report About? 7

1.2. Definitions 7

1.3. Summary Methodology 9

1.4. About Strategic Defense Intelligence 10

2. Executive Summary 11

3. Market Attractiveness and Emerging Opportunities 13

3.1. Current Market Scenario 14

3.1.1. Primary Threat Perception 14

3.1.2. Military Doctrine & Strategy 15

3.1.3. Military Fleet Size 17

3.1.4. Procurement Programs 22

3.1.5. Social, Political, and Economic Environment & Support for Defense Projects 24

3.1.6. Political and Strategic Alliances 25

3.2. Defense Market Size, Historical and Forecast 26

3.2.1. Venezuelan defense expenditure expected to increase at a CAGR of

0.39% over 2018-2022 26

3.2.2. Modernization, border disputes, and the development of the domestic defense industry to drive defense expenditure over the forecast period 28

3.2.3. Venezuelan defense expenditure as a percentage of GDP to increase 30

3.3. Analysis of Defense Budget Allocation 32

3.3.1. Share of revenue expenditure accounts for the majority of the Venezuelan defense budget over the forecast period 32

3.3.2. Capital expenditure is expected to gain momentum to reach a forecast CAGR of -1.05% during 2018-2022 34

3.3.3. Per-capita defense expenditure expected to decrease during the forecast period 36

3.4. Homeland Security Market Size and Forecast 38

3.4.1. Homeland security budget to register a negative CAGR of

6.96% during the forecast period 38

3.4.2. Civil unrest, drug trafficking, and organized crime to drive the HLS market 42

3.4.3. Venezuela to be at ‘some risk’ from terrorist attack 44

3.4.4. Venezuela faces moderate threat from foreign terrorist organizations 45

3.4.5. Venezuela has a terrorism index score of

2.0 47

3.4.6. The terrorism index is calculated on the basis of the following factors: 47

3.5. Benchmarking with Key Global Markets 48

3.5.1. Venezuela’s defense budget to remain low in the forecast period 48

3.5.2. Venezuela’s military expenditure is limited compared to countries with the highest defense expenditures 50

3.5.3. Venezuela allocates a high percentage of GDP to defense 51

3.6. Market Opportunities: Key Trends and Growth Stimulators 53

3.6.1. Military Infrastructure Construction 53

3.6.2. Missile Defense Systems 54

3.6.3. Military Training Aircraft 55

3.6.4. Military Facilities Management 56

4. Defense Procurement Market Dynamics 57

4.1. Import Market Dynamics 58

4.1.1. Limited capability of domestic defense market drives imports 58

4.1.2. Venezuela largely imports from Russia 59

4.1.3. Air defense systems, missiles, and armored vehicles are the most imported military hardware 60

4.2. Export Market Dynamics 61

4.2.1. Defense exports increased during the historic period 61

5. Industry Dynamics 62

5.1. Five Forces Analysis 62

5.1.1. Bargaining power of supplier: High 63

5.1.2. Bargaining power of buyer: Low 63

5.1.3. Barriers to entry: Medium 63

5.1.4. Intensity of rivalry: low to medium 63

5.1.5. Threat of substitution: low to medium 63

6. Market Entry Strategy 64

6.1. Market Regulation 64

6.1.1. Venezuela does not disclose any offset obligations 64

6.1.2. Venezuela allows 100% FDI in defense industry 64

6.2. Market Entry Route 65

6.2.1. Budget Process 65

6.2.2. Procurement Policy and Process 65

6.2.3. Direct selling is the preferred market entry route for foreign OEMs 66

6.2.4. Joint product development and military collaborations provide market entry opportunities 67

6.3. Key Challenges 68

6.3.1. Small defense budget and underdeveloped domestic industry discourages foreign participation 68

6.3.2. Corruption serves as an obstacle for market entry 68

6.3.3. The arms embargo against Venezuela makes market entry difficult for foreign defense companies 68

7. Competitive Landscape and Strategic Insights 70

7.1. Competitive Landscape Overview 70

7.2. Key Domestic Companies 71

7.2.1. CA Venezolana de Industrias Militares (CAVIM): Overview 71

7.2.2. CAVIM: Products and Services 71

7.2.3. CAVIM: Recent Announcements and Strategic Initiatives 71

7.2.4. CAVIM: Alliances 72

7.2.5. UCOCAR CA: Overview 73

7.2.6. UCOCAR CA: Products and Services 73

7.2.7. UCOCAR CA: Recent Announcements and Strategic Initiatives 73

7.2.8. UCOCAR CA: Recent Contract Awards 74

7.2.9. Diques y Astilleros Nacionales CA (DIANCA): Overview 75

7.2.10. DIANCA: Recent Announcements and Strategic Initiatives 75

7.2.11. DIANCA: Products and Services 75

7.2.12. DIANCA: Alliances 76

7.2.13. DIANCA: Recent Contract Awards 76

8. Business Environment and Country Risk 77

8.1. Economic Performance 77

8.1.1. Gross Domestic per Capita 77

8.1.2. Gross Domestic Product, current US$ 78

8.1.3. Exports of Goods and Services 79

8.1.4. Imports of Goods and Services 80

8.1.5. Gross National Disposable Income 81

8.1.6. Local Currency Unit per US$ 82

8.1.7. Market Capitalization of Listed Companies 83

8.1.8. Market Capitalization of Listed Companies as a Percentage of GDP 84

8.1.9. Total Government Cash Surplus/Deficit as a Percentage of GDP 85

8.1.10. Exported Goods as a Percentage of GDP 86

8.1.11. Imported Goods as a Percentage of GDP 87

8.1.12. Services Exports as a Percentage of GDP 88

8.1.13. Services Imports as a Percentage of GDP 89

8.1.14. Foreign Direct Investments, Net (BoP, Current US$ Billion) 90

8.1.15. Net Foreign Direct Investment as a Percentage of GDP 91

8.1.16. Mining, Manufacturing and Utilities Output (LCU Billion) 92

9. Appendix 93

9.1. About SDI 93

9.2. Disclaimer 93

Table

List of Tables

Table 1: Venezuelan Army Strength 17

Table 2: Venezuelan Air Force Strength 20

Table 3: Venezuelan Navy Strength 21

Table 4: Venezuelan – Ongoing Development and Procurement Programs 22

Table 5: Venezuelan – Future Procurement Programs 23

Table 6: Venezuelan Defense Expenditure (VEF Billion & US$ Billion), 2013-2022 26

Table 7: Venezuelan GDP Growth and Defense Expenditure as Percentage of GDP Growth, 2013-2022 30

Table 8: Venezuelan Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2022 32

Table 9: Venezuelan Defense Capital Budget (VEF Billion & US$ Billion), 2013-2022 34

Table 10: Venezuelan Per Capita Defense Expenditure (US$), 2013-2022 36

Table 11: Venezuelan Homeland Security Expenditure (VEF Billion & US$ Billion), 2013-2022 39

Table 12: Terrorism Index, 2017 45

Table 13: Benchmarking with Key Markets, 2013-2017 vs. 2018-2022 48

Table 14: The Venezuelan Budget Formation Timetable 65

Table 15: Competitive Landscape of the Venezuela Defense Industry 70

Table 16: CA Venezolana de Industrias Militares (CAVIM) – Product Focus 71

Table 17: CA Venezolana de IndustriasMilitares (CAVIM) – Alliances 72

Table 18: UCOCAR CA – Product Focus 73

Table 19: UCOCAR CA: Recent Contract Wins 74

Table 20: Diques y Astilleros Nacionales CA (DIANCA) – Product Focus 75

Table 21: Diques y Astilleros Nacionales CA (DIANCA): Alliances 76

Table 22: Diques y Astilleros Nacionales CA (DIANCA): Recent Contract Wins 76

Figures

List of Figures

Figure 1: Venezuelan Defense Expenditure (VEF Billion), 2013-2022 27

Figure 2: Venezuelan Defense Expenditure (US$ Billion), 2013-2022 27

Figure 3: Venezuelan GDP Growth and Defense Expenditure as Percentage of GDP Growth, 2013-2022 31

Figure 4: Venezuela Defense Budget Split Between Capital and Revenue Expenditure (%), 2013-2022 33

Figure 5: Venezuelan Capital Expenditure on Defense (VEF Billion), 2013-2022 35

Figure 6: Venezuelan Defense Capital Expenditure (US$ Billion), 2013-2022 35

Figure 7: Venezuelan Per Capita Defense Expenditure (US$), 2013-2022 37

Figure 8: Venezuelan Homeland Security Expenditure (VEF Billion), 2013-2022 39

Figure 9: Venezuelan Homeland Security Budget (US$ Billion), 2013-2022 41

Figure 10: Terrorism Heat Map, 2017 44

Figure 11: Terrorism Index, 2017 47

Figure 12: Benchmarking with Key Markets: 2013-2017 vs. 2018-2022 49

Figure 13: Defense Expenditure of Countries with the Highest Global Military Expenditure (US$ Billion), 2017 and 2022 50

Figure 14: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2017 51

Figure 15: Military Infrastructure Construction Market Size (US$ Million), 2017-2027 53

Figure 16: Missile Defense Systems Market Size (US$ Million), 2017-2027 54

Figure 17: Military Training Aircraft Market Size (US$ Million), 2017-2027 55

Figure 18: Military Facilities Management Market Size (US$ Million), 2017-2027 56

Figure 19: Venezuelan Defense Imports, 2012-2016 (TIV Values) 58

Figure 20: Venezuelan Defense Imports by Country (%), 2012-2016 59

Figure 21: Venezuelan Defense Imports by Category (%), 2012-2016 60

Figure 22: Industry Dynamics-Porter’s Five Forces Analysis 62

Figure 23: Venezuela GDP per capita, 2015-2025 77

Figure 24: Venezuela Gross Domestic Product (current US$ Billion), 2015-2025 78

Figure 25: Venezuela Exports of Goods and Services (LCU Billion), 2005-2013 79

Figure 26: Venezuela Imports of Goods and Services (LCU Billion), 2005-2013 80

Figure 27: Venezuela Gross National Disposable Income (US$ Billion), 2005-2013 81

Figure 28: Venezuela LCU per US$, 2015-2024 82

Figure 29: Venezuela Market Capitalization of Listed Companies (US$ Billion), 2005-2012 83

Figure 30: Venezuela Market Capitalization of Listed Companies as a Percentage of GDP, 2005-2012 84

Figure 31: Venezuelan Government Cash Surplus/Deficit as a Percentage of GDP, 2000-2005 85

Figure 32: Venezuelan Exported Goods as a Percentage of GDP, 2005-2013 86

Figure 33: Venezuelan Imported Goods as a Percentage of GDP, 2005-2013 87

Figure 34: Venezuelan Services Exports as a Percentage of GDP, 2005-2013 88

Figure 35: Venezuelan Services Imports as a Percentage of GDP, 2005-2013 89

Figure 36: Venezuelan Foreign Direct Investments, Net (BoP, Current US$ Billion), 2005-2013 90

Figure 37: Venezuela Net Foreign Direct Investment as % of GDP, 2005-2013 91

Figure 38: Mining, Manufacturing and Utilities Output (LCU Billion), 2005-2014 92

Frequently asked questions

Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022 standard reports

Currency USD

Single User

$1,250

Can be used by individual purchaser only

Undecided about purchasing this report?

Enquire Before Buying Download FREE Resources

Get in touch to find out about multi-purchase discounts

reportstore@globaldata.com
Tel +44 20 7947 2745

Sample Report

Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022 was curated by the best experts in the industry and we are confident about its unique quality. However, we want you to make the most beneficial decision for your business, so we offer free sample pages to help you:

Assess the relevance of the report
Evaluate the quality of the report
Justify the cost

Download your copy of the sample report and make an informed decision about whether the full report will provide you with the insights and information you need.

Below is a sample report to understand what you are buying

See what our customers are saying

“The GlobalData platform is our go-to tool for intelligence services. GlobalData provides an easy way to access comprehensive intelligence data around multiple sectors, which essentially makes it a one-for-all intelligence platform, for tendering and approaching customers.

GlobalData is very customer orientated, with a high degree of personalised services, which benefits everyday use. The highly detailed project intelligence and forecast reports can be utilised across multiple departments and workflow scopes, from operational to strategic level, and often support strategic decisions. GlobalData Analytics and visualisation solutions has contributed positively when preparing management presentations and strategic papers.”

Business Intelligence & Marketing Manager, SAL Heavy Lift

“COVID-19 has caused significant interference to our business and the COVID-19 intelligence from GlobalData has helped us reach better decisions around strategy. These two highlights have helped enormously to understand the projections into the future concerning our business units, we also utilise the project database to source new projects for Liebherr-Werk to use as an additional source to pitch for new business.”

Market Analyst & Management, Liebherr-Werk

Your daily news has saved me a lot of time and keeps me up-to-date with what is happening in the market, I like that you almost always have a link to the source origin. We also use your market data in our Strategic Business Process to support our business decisions. By having everything in one place on the Intelligence Center it has saved me a lot of time versus looking on different sources, the alert function also helps with this.

Head of Key Accounts, Saab AB

Having used several other market research companies, I find that GlobalData manages to provide that ‘difficult-to-get’ market data that others can’t, as well as very diverse and complete consumer surveys.

Marketing Intelligence Manager, Portugal Foods

Our experience with GlobalData has been very good, from the platform itself to the people. I find that the analysts and the account team have a high level of customer focus and responsiveness and therefore I can always rely on. The platform is more holistic than other providers. It is convenient and almost like a one stop shop. The pricing suite is highly competitive and value for our organisation.

I like reports that inform new segments such as the analysis on generation Z, millennials, the impact of COVID 19 to our banking customers and their new channel habits. Secondly the specialist insight on affluent sector significantly increases our understanding about this group of customers. The combination of those give us depth and breadth of the evolving market.

I’m in the business of answering and helping people make decisions so with the intelligence center I can do that, effectively and efficiently. I can share quickly key insights that answer and satisfy our country stakeholders by giving them many quality studies and primary research about competitive landscape beyond the outlook of our bank. It helps me be seen as an advisory partner and that makes a big difference. A big benefit of our subscription is that no one holds the whole data and because it allows so many people, so many different parts of our organisation have access, it enables all teams to have the same level of knowledge and decision support.

Head of Customer Insight and Research, Standard Chartered

“I know that I can always rely on Globaldata’s work when I’m searching for the right consumer and market insights. I use Globaldata insights to understand the changing market & consumer landscape and help create better taste & wellbeing solutions for our customers in food, beverage and healthcare industries.

Globaldata has the right data and the reports are of very high quality compared to your competitors. Globaldata not only has overall market sizes & consumer insights on food & beverages but also provides insights at the ingredient & flavour level. That is key for B2B companies like Givaudan. This way we understand our customers’ business and also gain insight to our unique industry”

Head of Consumer Sensory Insights, Givaudan

GlobalData provides a great range of information and reports on various sectors that is highly relevant, timely, easy to access and utilise. The reports and data dashboards help engagement with clients; they provide valuable industry and market insights that can enrich client conversations and can help in the shaping of value propositions. Moreover, using GlobalData products has helped increase my knowledge of the finance sector, the players within it, and the general threats and opportunities.

I find the consumer surveys that are carried out to be extremely beneficial and not something I have seen anywhere else. They provided an insightful view of why and which consumers take (or don’t) particular financial products. This can help shape conversations with clients to ensure they make the right strategic decisions for their business.

One of the challenges I have found is that data in the payments space is often piecemeal. With GD all of the data I need is in one place, but it also comes with additional market reports that provide useful extra context and information. Having the ability to set-up alerts on relevant movements in the industry, be it competitors or customers, and have them emailed directly to me, ensures I get early sight of industry activity and don’t have to search for news.

Senior Account Manager, TSYS

Related reports

View more Homeland Security reports

Aerospace and Defense

New

Manned-Unmanned Teaming - Strategic Intelligence

Aerospace and Defense

New

Slovakia Defense Market Data: Budget Allocations, Fleet Size and Program…

Aerospace and Defense

New

Norway Defense Market Data: Budget Allocations, Fleet Size and Program…

Go even deeper with GlobalData Intelligence Center

Every Company Report we produce is powered by the GlobalData Intelligence Center.

Subscribing to our intelligence platform means you can monitor developments at Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022 in real time.

Access a live Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022 dashboard for 12 months, with up-to-the-minute insights.
Fuel your decision making with real-time deal coverage and media activity.
Turn insights on financials, deals, products and pipelines into powerful agents of commercial advantage.

Tell me more

Reports

Reports by Sector

Report Type

Future of the Venezuelan Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022

Scope

Reasons to Buy

Table of Contents

Table

Figures

Frequently asked questions

Undecided about purchasing this report?

Get in touch to find out about multi-purchase discounts

Sample Report

Below is a sample report to understand what you are buying

Related reports