Business Monitor International


Vietnam Defence & Security Report

Published 10 April 2014

  • 63 pages
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$1,295.00
Vietnam Defence & Security Report

BMI View: Given China's increased territorial assertiveness in the South China Sea, Vietnam is increasingly finding itself squeezed between the US and China.

Vietnam is involved in territorial disputes with China in the South China Sea, most notably over the Spratly and Parcel Islands. Although Beijing denies that is planning to declare an ADIZ in the South China Sea, a recent announcement by foreign minister Wang Yi that China would 'defend every inch' of its territory has no doubt left Hanoi worried.

Beijing's increasing assertiveness n has had a pronounced effect on Vietnam's defence policy over the past decade. Indeed, between 2005 and 2012 Vietnam's defence spending doubled. As with most other neighbouring countries, regional tensions have ensured that defence sales have remained buoyant despite various economic challenges. Over the past few months, Vietnam has taken delivery of a number of pieces of defence equipment from other countries, and has sought to increase ties with the US.

Given this increasing appetite for new defence equipment, as a result of rising tensions with China in the South China Sea, Vietnam has become a key market for a range of countries. While Moscow has always been Hanoi's primary defence partner, due to the latter's reliance on Soviet-era equipment, a number of European defence companies are also expanding ties with the country. Airbus Helicopter, French naval company DCNS and European missile-maker MBDA are all reportedly looking to win contracts in Hanoi.

Defence ties with the US have continued to strengthen since the ADIZ declaration in November 2013. Following US Secretary of State John Kerry's visit to Vietnam in December 2013 a range of deals have been announced between the two countries. This includes US$32.5mn in assistance for maritime law enforcement in South East Asia, US$18mn of which is earmarked for Vietnam. In March 2014 Wendy Sherman, the Under-Secretary Of State For Political Affairs, followed Kerry's visit to...

Table of Contents

Executive Summary
5
SWOT Analysis
7
Vietnam Security SWOT
7
Vietnam Defence Industry SWOT
9
Vietnam Political SWOT
10
Vietnam Economic SWOT
11
Vietnam Business Environment SWOT
12
Global Political Outlook
13
Table: Elections In 2013
17
South East Asia Security Overview
21
The Strategic Outlook For The 2010s
21
Challenges And Threats To Stability And Security
21
Main Islamist Militant Groups In South East Asia
24
Other Regional Threats
28
Sino-US Rivalry In South East Asia
30
Sino-Japanese Rivalry In South East Asia
31
The Outlook For South East Asia
32
Security Risk Analysis
33
Asia Pacific Risk Ratings
33
Table: Asia Pacific Regional Security Ratings
33
Table: Asia Pacific State Vulnerability To Terrorism Index
34
Vietnam-s Security Risk
34
Political Outlook
35
Domestic Politics
35
Long-Term Political Outlook
36
Security Overview
39
Internal Security Situation
39
Governance
39
Religion
40
Piracy And Maritime Security
41
Border Security
41
External Security Situation
42
The South China Sea
44
Bilateral Relations
49
Armed Forces And Government Spending
55
Armed Forces
55
Weapons Of Mass Destruction
58
Market Overview
60
Industry Trends And Developments
61
Arms Trade Overview
61
Procurement Trends And Developments
62
Industry Forecast Scenario
63
Armed Forces
63
Table: Vietnam-s Armed Forces, 2001-2008 (-000 personnel, unless otherwise stated)
63
Table: Vietnam-s Manpower Available For Military Services, 2010-2017 (aged 16-49, unless otherwise stated)
63
Government Expenditure
63
Table: Vietnam-s Defence Expenditure, 2010-2017
64
Table: Vietnam-s Defence Expenditure Scenario - Changing % Of GDP, 2010-2017 (US$mn)
65
Defence Trade
66
Table: Vietnam-s Defence Exports, 2010-2017 (US$mn)
66
Table: Vietnam-s Defence Imports, 2010-2017 (US$mn)
67
Table: Vietnam-s Defence Trade Balance, 2010-2017 (US$mn)
67
Macroeconomic Forecast
68
Table: Vietnam - Economic Activity
69
BMI Methodology
71
How We Generate Our Industry Forecasts
71
Defence Industry
71
Sources
72

The Vietnam Defence & Security Report features Business Monitor International (BMI)'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 Vietnam Defence & Security Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Vietnamese defence and security industry.

Key Benefits

  • Benchmark BMI's independent defence and security industry forecasts on Vietnam to test other views - a key input for successful budgetary and strategic business planning in the Vietnamese defence and security market.
  • Tar

    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'.

    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 Rankings provide 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.

    Domestic Security Overview

    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.

    BMI Industry Forecast Scenario

    Historic data series and forecasts to end-2018 for key industry indicators supported by explicit assumptions, plus analysis of key downside risks to the main forecast.

    Budgets & Expenditure: Defence expenditure (local currency and US$bn); defence expenditure (% of total budget); defence expenditure (% of GDP); defence expenditure per capita, US$; defence budget (local currency and US$bn).

    Employment: Employment in arms production (`000s); employment in arms production (% of labour force).

    Macroeconomic: BMI's forecasts and analysis of all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt.

    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.

    Domestic Security Overview

    The reports also provide a regional overview which details specific issues and flashpoints affecting , along with potential risks in the coming year.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc