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The Colombian Defense Sector
Market Opportunities and Entry Strategies, Analyses and Forecasts to 2015

  • Publication Date:October 2010
  • Publisher:ICD-Research
  • Product Type: Report
  • Pages:129

The Colombian Defense Sector Market Opportunities and Entry Strategies, Analyses and Forecasts to 2015

This report offers insights into the market opportunities and entry strategies adopted by foreign OEMs (original equipment manufacturers) to gain a market share in the Colombiandefense industry. In particular, it offers in-depth analysis of the following:

  • Market opportunity and attractiveness: detailed analysis of the current industry size and growth expectations during 2010-2015, including highlights of the key growth stimulators. It also benchmarks the industry against key global markets and provides detailed understanding of emerging opportunities in specific areas.
  • Procurement dynamics: trend analysis of imports and exports, together with its implications and impact on the Colombian defense industry.
  • Industry structure: five forces analysis to identify various power centers in the industry and how these are likely to develop in the future.
  • Market entry strategy: analysis of possible ways to enter the market, together with detailed descriptions of how existing players have entered the market, including key contracts, alliances, and strategic initiatives.
  • Competitive landscape and strategic insights: analysis of competitive landscape of the defense industry in Colombia. 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.
  • Business environment and country risk: a range of drivers at country level, assessing business environment and country risk. It covers historical and forecast values for a range of indicators, evaluating business confidence, economic performance, infrastructure quality and availability, labor force, demographics, and political and social risk.
  • 1 Introduction
    • 1.1 About this Report
    • 1.2 Definitions
    • 1.3 Methodology
      • 1.3.1 Secondary research
      • 1.3.2 Primary research
      • 1.3.3 Conventions
    • 1.4 ICD Research Intelligence Terrorism Index
    • 1.5 About ICD Research Defense Intelligence Center
  • 2 Executive Summary
  • 3 Market Attractiveness and Emerging Opportunities
    • 3.1 Defense Industry Size - Review and Forecast
      • 3.1.1 Colombian defense expenditure expected to reach US$18.98 billion by 2015
      • 3.1.2 Threat from Venezuela, high crime levels, military modernization, threats from rebel groups and drug trafficking set to increase defense expenditure
      • 3.1.3 Defense expenditure as a percentage of GDP expected to rise to 5.1% by 2015
    • 3.2 Analysis of Defense Budget Allocation
      • 3.2.1 Majority of defense budget allocated for revenue expenditure
      • 3.2.2 Police and other defense expenses account for majority of defense budget
      • 3.2.3 Budget allocation for army higher than remaining military divisions
      • 3.2.4 Navy receives limited defense budget allocation
      • 3.2.5 Government plans substantial investment in air force to boost air power
      • 3.2.6 Police force receives a quarter of the total defense budget
      • 3.2.7 Other expenses account for majority of defense budget
    • 3.3 Homeland Security Market Size - Review and Forecast
      • 3.3.1 Colombian HLS market to grow steadily over 2011-15
      • 3.3.2 Internal security challenges expected to increase homeland security expenditure
      • 3.3.3 ICD Research Intelligence Terrorism Index rates Colombia to be a ""highly affected"" region
      • 3.3.4 Columbia scores 2.2 on the terrorism index
    • 3.4 Benchmarking with Key Global Markets
      • 3.4.1 Colombian defense expenditure forecast to grow faster than the majority of largest global defense budgets
      • 3.4.2 Colombian defense expenditure is one of the highest in South America
      • 3.4.3 Colombia spends more than 4% of its GDP on defense
      • 3.4.4 Colombia is ""highly affected"" by acts of terrorism
    • 3.5 Market Opportunities: Key Trends and Growth Stimulators
      • 3.5.1 Increased demand for medium-lift utility helicopters expected in the next two years
      • 3.5.2 Lack of battle tanks to lead to new army procurement
      • 3.5.3 UAV procurement will increase as a part of the military modernization program
      • 3.5.4 US$3 billion proposal to enhance air defense systems will create new opportunities
  • 4 Defense Procurement Market Dynamics
    • 4.1 Import Market Dynamics
      • 4.1.1 Limitations of the domestic defense industry will support arms imports
      • 4.1.2 Defense imports have grown significantly over the last five years
      • 4.1.3 US and Israel continue to be major arms suppliers
      • 4.1.4 Aircraft account for majority of defense imports
    • 4.2 Export Market Dynamics
      • 4.2.1 Colombia is not a major defense exporting country
  • 5 Industry Dynamics
    • 5.1 Five Forces Analysis
      • 5.1.1 Bargaining power of supplier: low to medium
      • 5.1.2 Bargaining power of buyer: high to medium
      • 5.1.3 Barrier to entry: low to high
      • 5.1.4 Intensity of rivalry: low
      • 5.1.5 Threat of substitution: medium
  • 6 Market Entry Strategy
    • 6.1 Market Regulation
      • 6.1.1 Offset guidelines are channeled to benefit industrial and social sectors
      • 6.1.2 FDI in defense sector is closed
    • 6.2 Market Entry Route
      • 6.2.1 Direct selling is the preferred market entry route for foreign OEMs
    • 6.3 Key Challenges
      • 6.3.1 Corruption, bribery and influence of anti-state elements damages the credibility of military
      • 6.3.2 Low capital expenditure discourages both foreign and domestic firms
  • 7 Competitive Landscape and Strategic Insights
    • 7.1 Competitive Landscape Overview
    • 7.2 Key Public Sector Company
      • 7.2.1 Industria Militar: overview
      • 7.2.2 Industria Militar: products and services
      • 7.2.3 Industria Militar: recent announcements and strategic initiatives
      • 7.2.4 Industria Militar: alliances
      • 7.2.5 Industria Militar: recent contract wins
      • 7.2.6 Industria Militar: financial analysis
    • 7.3 Key Private Sector Company
      • 7.3.1 Sudamin Aeronautica y Defensa S.A.: overview
      • 7.3.2 Sudamin Aeronautica y Defensa S.A.: products and services
      • 7.3.3 Sudamin Aeronautica y Defensa S.A.: recent announcements and strategic initiatives
      • 7.3.4 Sudamin Aeronautica y Defensa S.A.: alliances
      • 7.3.5 Sudamin Aeronautica y Defensa S.A.: recent contract wins
      • 7.3.6 Sudamin Aeronautica y Defensa S.A.: financial analysis
      • 7.3.7 Cotecmar: overview
      • 7.3.8 Cotecmar: products and services
      • 7.3.9 Cotecmar: recent announcements and strategic initiatives
      • 7.3.10 Cotecmar: alliances
      • 7.3.11 Cotecmar: recent contract wins
      • 7.3.12 Cotecmar: financial analysis
  • 8 Business Environment and Country Risk
    • 8.1 Business Confidence
      • 8.1.1 Market capitalization trend - The Colombian Stock Exchange (BVC), Colombia
      • 8.1.2 FDI inflows by sector
      • 8.1.3 Deployment of credit
    • 8.2 Economic Performance
      • 8.2.1 GDP at constant prices
      • 8.2.2 GDP per capita at constant prices
      • 8.2.3 GDP at current prices
      • 8.2.4 GDP per capita at current prices
      • 8.2.5 GDP split by key sectors
      • 8.2.6 Agriculture net output at current prices (local currency)
      • 8.2.7 Agriculture net output at current prices (US dollars)
      • 8.2.8 Agriculture net output at current prices as percentage of GDP
      • 8.2.9 Manufacturing net output at current prices (local currency)
      • 8.2.10 Manufacturing net output at current prices (US dollars)
      • 8.2.11 Manufacturing net output at current prices as percentage of GDP
      • 8.2.12 Mining, manufacturing and utilities net output at current prices (local currency)
      • 8.2.13 Mining, manufacturing and utilities at current prices (US dollars)
      • 8.2.14 Mining, manufacturing and utilities at current prices as percentage of GDP
      • 8.2.15 Construction net output at current prices (local currency)
      • 8.2.16 Construction net output at current prices (US dollars)
      • 8.2.17 Construction output at current prices as a percentage of GDP
      • 8.2.18 Crude steel production
      • 8.2.19 Crude oil consumption
      • 8.2.20 Inflation rate
      • 8.2.21 Fiscal deficit as a percentage of GDP
      • 8.2.22 Trade balance as a percentage of GDP
      • 8.2.23 Exports as a percentage of GDP
      • 8.2.24 Imports as a percentage of GDP
      • 8.2.25 Exports growth
      • 8.2.26 Imports growth
      • 8.2.27 External debt as percentage of GDP
      • 8.2.28 Debt service ratio
      • 8.2.29 Exchange rate US$-COP (annual average)
      • 8.2.30 Exchange rate US$-COP (end of fiscal)
    • 8.3 Infrastructure Quality and Availability
      • 8.3.1 Total airports and ports
      • 8.3.2 Railways and roads
      • 8.3.3 Automotive components export trend
      • 8.3.4 Automotive products import trend
      • 8.3.5 Passenger car penetration
      • 8.3.6 Total installed capacity for electricity generation
      • 8.3.7 Installed capacity for conventional thermal electricity generation
      • 8.3.8 Electricity Production
      • 8.3.9 Installed capacity for hydroelectricity generation
      • 8.3.10 Installed capacity for renewable electricity generation
      • 8.3.11 Electric power consumption
      • 8.3.12 Electricity exports
      • 8.3.13 Healthcare expenditure
      • 8.3.14 Healthcare expenditure as a percentage of GDP
      • 8.3.15 Healthcare expenditure per capita
      • 8.3.16 Research and development expenditure as a percentage of GDP
      • 8.3.17 Total internet subscribers
      • 8.3.18 Broadband internet subscribers
      • 8.3.19 Personal computer penetration
      • 8.3.20 Mobile phone penetration rate
    • 8.4 Labor Force
      • 8.4.1 Labor force
      • 8.4.2 Unemployment rate
    • 8.5 Demographics
      • 8.5.1 Annual disposable income
      • 8.5.2 Annual per capita disposable income
      • 8.5.3 Annual consumer expenditure on food
      • 8.5.4 Annual per capita consumer expenditure on food
      • 8.5.5 Urban and rural population
      • 8.5.6 Females as percentage of population
      • 8.5.7 Males as percentage of population
      • 8.5.8 Mean age of population
      • 8.5.9 Median age of population
      • 8.5.10 Population density
      • 8.5.11 Age distribution of the total population
      • 8.5.12 Age distribution of the male population
      • 8.5.13 Age distribution of the female population
      • 8.5.14 Number of households
    • 8.6 Political and Social Risk
      • 8.6.1 Political stability
      • 8.6.2 Terrorism index
      • 8.6.3 Transparency index
  • 9 Appendix
    • 9.1 Contact Us
    • 9.2 About ICD Research
    • 9.3 DisclaimerTable 1: ICD Research Intelligence Terrorism Index
  • List of Tables
    • Table 2: Colombian Defense Offset Regulations
    • Table 3: Industria Militar - Alliances
    • Table 4: Sudamin Aeronautica y Defensa S.A. Alliances
    • Table 5: Cotecmar - AlliancesFigure 1: Colombian Defense Expenditure (US$ Billion), 2004-15
  • List of Figures
    • Figure 2: Colombian Defense Expenditure as a Percentage of GDP (%), 2004-15
    • Figure 3: Colombian Defense Expenditure Allocation for Revenue and Capital Expenditure (%), 2004-15
    • Figure 4: Colombian Defense Budget Breakdown (%), 2004-15
    • Figure 5: Colombian Defense Budget Allocation for Army (US$ Billion), 2004-15
    • Figure 6: Colombian Defense Budget Allocation for Navy (US$ Billion), 2004-15
    • Figure 7: Colombian Defense Budget Allocation for Air Force (US$ Billion), 2004-15
    • Figure 8: Colombian Defense Budget Allocation for Police Force (US$ Billion), 2004-15
    • Figure 9: Colombian Defense Budget Allocation for Other Category (US$ Billion), 2004-15
    • Figure 10: Colombian Homeland Security Market Value (US$ Million), 2004-15F
    • Figure 11: ICD Research Intelligence Terrorism Heat Map, 2009
    • Figure 12: ICD Research Intelligence Terrorism Index, 2009
    • Figure 13: Benchmarking with Key Global Markets, Review vs. Forecast Defense Expenditure Growth
    • Figure 14: Defense Expenditure of the Largest Military Spenders (US$ Billion), 2009 and 2015
    • Figure 15: Defense Expenditure of the Largest Military Spenders as a Percentage of GDP (%), 2009
    • Figure 16: Colombian Defense Imports (TIVs), 2005-09
    • Figure 17: Colombian Defense Imports by Region (TIVs), 2005-09
    • Figure 18: Colombian Defense Imports by Category (TIVs), 2005-09
    • Figure 19: Industry Dynamics, Porter's Five Forces Analysis
    • Figure 20: Industria Militar - Revenue Trend Analysis (COP Billion), FY 2005-09
    • Figure 21: Industria Militar - Operating Profit Trend Analysis (COP Billion), FY 2005-09
    • Figure 22: Industria Militar - Net Profit Trend Analysis (COP Billion), FY 2005-09
    • Figure 23: The Colombian Stock Exchange (BVC) Market Capitalization (US$ Billion), 2003-09
    • Figure 24: Colombian FDI Inflows by Sector (US$ Billion), 2003-09
    • Figure 25: Colombian Deployment of Credit (US$ Billion), 2003-09
    • Figure 26: Colombian GDP Value at Constant Prices (US$ Billion), 2003-15
    • Figure 27: Colombian GDP per Capita at Constant Prices (US$ Billion), 2003-15
    • Figure 28: Colombian GDP at Current Prices (US$ Billion), 2003-15
    • Figure 29: Colombian GDP per Capita at Current Prices (US$), 2003-15
    • Figure 30: Colombian GDP Split by Key Sectors, 2003 vs. 2009
    • Figure 31: Colombian Agriculture Net Output at Current Prices (COP Billion), 2003-15
    • Figure 32: Colombian Agriculture Net Output at Current Prices (US$ Billion), 2003-15
    • Figure 33: Colombian Agriculture Net Output at Current Prices as a Percentage of GDP (%), 2003-15
    • Figure 34: Colombian Manufacturing Net Output at Current Prices (COP Billion), 2003-15
    • Figure 35: Colombian Manufacturing Net Output at Current Prices (US$ Billion), 2003-15
    • Figure 36: Colombian Manufacturing Net Output at Current Prices as a Percentage of GDP (% ), 2003-15
    • Figure 37: Colombian Mining, Manufacturing and Utilities Net Output at Current Prices (COP Billion), 2003-15
    • Figure 38: Colombian Mining, Manufacturing and Utilities Output at Current Prices (US$ Billion), 2003-15
    • Figure 39: Colombian Mining, Manufacturing and Utilities Output at Current Prices as a Percentage of GDP (%), 2003-15
    • Figure 40: Colombian Construction Net Output at Current Prices (COP Billion), 2003-15
    • Figure 41: Colombian Construction Net Output at Current Prices (US$ Billion), 2003-15
    • Figure 42: Colombian Construction Output at Current Prices as a Percentage of GDP (%), 2003-15
    • Figure 43: Colombian Crude Steel Production (Thousand Metric Tons), 2003-15
    • Figure 44: Colombian Crude Oil Consumption (Million Tons), 2003-15
    • Figure 45: Colombian Inflation Rate (%), 2003-15
    • Figure 46: Colombian Fiscal Balance as a Percentage of GDP (%), 2003-15
    • Figure 47: Colombia Trade Balance as a Percentage of GDP (%), 2003-09
    • Figure 48: Colombia Exports as a Percentage of GDP (%), 2003-15
    • Figure 49: Colombian Imports as a Percentage of GDP (%), 2003-15
    • Figure 50: Colombian Exports Growth (%), 2003-15F
    • Figure 51: Colombia Imports Growth (%), 2003-15
    • Figure 52: Colombia External Debt as a Percentage of GDP (%), 2003-09
    • Figure 53: Colombian Debt Service Ratio, 2003-09
    • Figure 54: Colombian Exchange Rate US$-COP (Annual Average), 2003-09
    • Figure 55: Colombian Exchange Rate US$-COP (End of Fiscal), 2003-09
    • Figure 56: Colombian Airports and Ports, 2009
    • Figure 57: Colombian Railways and Roadways (km), 2009
    • Figure 58: Colombian Automotive Components Exports (US$ Million), 2003-15
    • Figure 59: Colombian Automotive Components Imports (US$ Million), 2003-15
    • Figure 60: Colombian Passenger Car Penetration (per thousand people), 2003-15
    • Figure 61: Colombian Total Installed Capacity for Electricity Generation (million kilowatts), 2003-15
    • Figure 62: Colombian Installed Capacity for Conventional Thermal Electricity Generation (million kilowatts), 2003-15
    • Figure 63: Colombian Electricity Production (billion kilowatt hours), 2003-15
    • Figure 64: Colombian Installed Capacity for Hydroelectricity Generation (million kilowatts), 2003-15
    • Figure 65: Colombian Installed Capacity for Renewable Electricity Generation (million kilowatts), 2003-15
    • Figure 66: Colombian Electric Power Consumption (billion kWh), 2003-15
    • Figure 67: Colombian Electricity Exports (billion kWh), 2003-15
    • Figure 68: Colombian Healthcare Expenditure (US$ billion), 2003-15
    • Figure 69: Colombian Healthcare Expenditure as a Percentage of GDP (%), 2003-15
    • Figure 70: Colombian per Capita Healthcare Expenditure (US$), 2003-15
    • Figure 71: Colombian R&D Expenditure as a percentage of GDP (%), 2003-15
    • Figure 72: Colombian Internet Subscribers (thousands), 2003-15
    • Figure 73: Colombian Broadband Internet Subscribers (thousands), 2003-15
    • Figure 74: Colombian Personal Computer Usage (per hundred people), 2003-15
    • Figure 75: Colombian Mobile Phone Penetration (%), 2003-15
    • Figure 76: Colombian Size of Labor Force (in 15-59 age group), 2003-15
    • Figure 77: Colombian Unemployment Rate (%), 2003-15
    • Figure 78: Colombian Annual Disposable Income (US$ Billion), 2003-15
    • Figure 79: Colombian Annual per Capita Disposable Income (US$), 2003-15
    • Figure 80: Colombian Consumer Expenditure on Food (US$ Billion), 2003-15
    • Figure 81: Colombian Annual per Capita Consumer Expenditure on Food (US$), 2003-15
    • Figure 82: Colombian Urban and Rural Population (%), 2003-15
    • Figure 83: Colombian Females as a Percentage of Population (%), 2003-15
    • Figure 84: Colombian Males as a Percentage of Population (%), 2003-15
    • Figure 85: Colombian Mean Age of Population (Years), 2003-15
    • Figure 86: Colombian Median Age of Population (Years), 2003-15
    • Figure 87: Colombian Population Density(per Square Kilometer) 2003-15
    • Figure 88: Colombian Age Distribution of the Total Population (%), 2003-15
    • Figure 89: Colombian Age Distribution of the Male Population (%), 2003-15
    • Figure 90: Colombian Age Distribution of the Female Population, 2003-15
    • Figure 91: Colombian Number of Households (Million), 2003-15
    • Figure 92: Global Terrorism Heat Map, 2009
    • Figure 93: Colombian Transparency Index, 2003-09
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