Finland defence market: Almost $4 billion industry by 2018
2014-01-30 17:46:02 - Future of the Finnish Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2018 - a new market research report on companiesandmarkets.com
Although the budget for the Finland defence market contracted between 2009 and 2013 â at a CAGR of -0.76% - the government´s desire to strengthen the country´s defence capabilities is expected to spark positive growth in the Finnish defence market between 2014 and 2018.
This is expected to see a market expansion at an estimated CAGR or 1.56% between 2012-2018 reaching
US$3.9 billion. The Finnish government is projected to spend US$18.8 billion on its armed forces, of which an estimated US$6.7 billion will be spent on the procurement of defence systems and weapons.
In order to increase defence exports and cater to the international arms market, the Finnish government encourages domestic defence companies to collaborate with foreign defence firms. Conversely, foreign investors seek to capitalize on Finnish defence capabilities through the joint development of military hardware. Additionally, the country is focused on defence collaboration with other Nordic countries, thereby enhancing the domestic industrial capabilities of Finland, Norway, and Sweden, and forming a consolidated defence industry. For example, the country jointly established Nammo in 1998 through the merger of the ammunition activities of Raufoss ASA, which is based in Norway, and Celcius AB, which is based in Sweden.
Research findings have discovered that Italy emerged as the largest supplier of defence systems to Finland with a share of 23% of total imports, followed by Switzerland with 20.3%, and Sweden with 16.2%. In 2008, Switzerland supplied 45.8% of the Finnish imports while France, with a 22.4% share, was the second largest supplier to the country. Due to the economic crisis during 2008â2009, defence imports slumped by 72.6%, declining from US$157 million during 2008 to US$43 million in 2009. During the forecast period it is expected that Sweden, France, and Italy will continue to be strong defence trade partners for the country.
The procurement deal signed with Croatia in 2007 meant that armored vehicles were the largest contributor to Finnish defence exports with 53.2% share during 2008-2012 followed by ships with 20%. However, from 2008 onwards, Finland made no exports of ships. During the forecast period, it is anticipated that armored vehicles will continue to dominate the country´s arms exports due to an increase in the global demand for this product.
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