Philippines Defence & Security Report

Published 24 December 2014

  • 71 pages
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$1,295.00
Philippines Defence & Security Report

BMI View: Rising tensions with China have seen the Philippines significantly increase defence spending with the aim of revamping their military assets. Relations with China have further deteriorated following territorial disputes in early 2014. In addition, the Southeast Asian country is facing new internal threats by insurgent groups, especially Abu Sayyaf . These developments will therefore drive an increase in budget allocation towards defence spending by the government, which will reach USD3.4bn in 2015 . The lack of a clear strategic defence spending policy, however, and the under-developed domestic defence manufacturing sector, will open up opportunities for international companies but limit them within the country.

The Philippines' position close to China and the South China Sea, and the recent dispute over conflicting territorial claims in the Sea that has seen the Philippines take China to the UN Arbitral Tribunal, makes the country particularly interesting for a large number of powers in the region and internationally. As such, in the past decade the Philippines has been developing a number of defence cooperation agreements, with different countries, that not only aim at facilitating technology transfer but also provide assistance (whether financial or material) to the Philippines in modernising its military force.

Indeed, the Philippines currently has one of the weakest military forces in the region, in large part as a result of the obsolete equipment and platforms that are being used by its army, navy and air force. The 2012 Defence White Paper recognised this challenge and outlined a strategy to prompt the modernisation and upgrading of its armed forces. However, despite a constant increase in the defence budget in the past few years, the government has fallen short of its initial objectives.

The domestic defence sector remains significantly under-developed. The government has failed to recognised, thus far, the importance of the private...

BMI Industry View
7
SWOT
9
Philippines Security SWOT
9
Philippines Defence SWOT
12
Political
14
Economic
15
Industry Forecast
16
Table: Defence Expenditure (Philippines 2011-2018)
16
Armed Forces
18
Table: Armed Forces Personnel (Philippines 2004-2011)
19
Table: Manpower Available For Military Service (Philippines 2011-2018)
20
Defence Trade
20
Table: Defence Trade Balance (Philippines 2012-2019)
21
Imports
22
Table: Defence Imports (Philippines 2012-2019)
22
Exports
23
Table: Defence Exports (Philippines 2011-2018)
24
Macroeconomic Forecasts
25
Economic Analysis
25
Table: Economic Activity (Philippines 2009-2018)
28
Industry Risk Reward Ratings
29
Asia Security Risk Index
29
Table: Asia Security Risk Index
29
Table: Asia State Vulnerability To Terrorism Index
30
Philippines Security Risk Ratings
31
Market Overview
32
Philippines Defence Market Overview
32
Armed Forces
33
Domestic Industries
35
Exports
36
Imports
37
Philippines Security Overview
40
Domestic Threats
40
Table: Philippine Insurgent Groups
41
Regional Threats
42
International Threats
45
Company Profile
47
Arms Corporation of the Philippines (Armscor)
47
Government Arsenal
48
Regional Overview
50
South East Asia Security Overview
50
Challenges And Threats To Stability And Security
50
Global Industry Overview
62
Global Political Outlook
62
Methodology
68
Industry Forecast Methodology
68
Sector-Specific Methodology
69
Sources
70
Security Risk Index Methodology
70
Table: Indicators And Weighting
71

The Philippines Defence & Security Report features BMI Research's independent forecasts for national and international security, the defence industry, military expenditure, employment in arms production, and arms imports and exports, as well as examining industry trends and prospects, national and multinational arms producers and the regulatory environment.

BMI's Philippines Defence & Security Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Philippine defence and security industry.

Key Benefits

  • Benchmark BMI's independent defence and security industry forecasts on Philippines to test other views - a key input for successful budgetary and strategic business planning in the Philippine defence and security market.
  • Target business opportunities and risks in the Asia defence and security sector through reviews of latest industry trends, regulatory changes and major deals, projects and investments in Asia.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity).

Coverage

Global and Regional Political Outlooks

A strategic overview of the world’s major political risks, identifying countries facing leadership successions and nations at risk of upheaval, inter-state conflict, or separatism and insurgencies, plus a summary of the world’s ‘wild card’ low-probability high-impact risks.

SWOT Analysis

Snapshot evaluation of the major issues affecting the defence and security sectors, economy and politics, with issues subdivided into strengths, weaknesses, opportunities and threats.

BMI Industry Forecast Scenario

Historic data series and forecasts to end-2019 for key industry indicators supported by explicit assumptions, plus analysis of key downside risks to the main forecast.

  • Defence Expenditure: Defence expenditure (local currency and USDbn); defence expenditure (% of total budget); defence expenditure per capita (USD); defence budget (local currency and USDbn).
  • Armed Forces (to 2012): Manpower available for military service, manpower fit for militaryservice, army personnel, navy personnel,air force personnel, total armed forces, (‘000) (% population).
  • Arms Trade: Arms and ammunition exports and imports (USDmn); bombs, grenades and missiles exports and imports (USDmn); revolver and pistol exports and imports (USDmn); weapons excluding guns and swords exports and imports (USDmn).

Political Risk Assessment

Drawing on BMI’s heritage of more than 25 years of Country Risk analysis, this comprehensively evaluates the key risks to domestic politics and foreign relations, focusing on issues most likely to affect either domestic security or the defence sector.

Security Risk Analysis

BMI’s proprietary Security Risk Indices provide investors with a reliable and country-comparable guide to conflict, terrorism and criminal risk, backed up by our analyst’s latest assessment of each component. Furthermore, drawing on our Country Risk expertise, we assess the state’s vulnerability to a serious, or prolonged, terrorist campaign.

Armed Forces Spending/ Expenditure

The reports contain a detailed breakdown of areas of expenditure by the armed forces, these include spending on international deployments, WMDs and missile defence systems as well as individual breakdowns of the cost-per-soldier.

Competitive Landscape

The domestic security overview lists the various potential internal security threats facing a country, ranging from internal security issues such as terrorism, cyber terrorism, crime and drugs, to external security issues including general defence procedures and potential threats from specific countries. The reports also provide a regional overview which details specific issues and flashpoints affecting the Americas, along with potential risks in the coming year.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Defence & Security Market reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.

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