Future of the Algerian Defense Industry - Market Attractiveness, Competitive Landscape and Forecasts to 2023

Algeria’s sudden rise as a major military force in Africa can be attributed to its burgeoning economy and a desire to establish its military superiority in the region. With a defense budget of US$9.8 billion in 2018, Algeria is currently the largest military spender in the African region. Military expenditure is strongly supported by the presence of the oil and natural gas industry, where revenues are directed towards strengthening defense and security.

The country’s capital expenditure is expected to increase from US$1.9 billion in 2019 to US$2.3 billion in 2023, growing at a robust CAGR of 4.56% over the forecast period. The increased threat of terrorism from the Islamic group Al-Qaeda in the Islamic Maghreb (AQIM) operating in North Africa, an arms race with neighboring countries such as Morocco and Tunisia, and the ongoing modernization of its armed forces are key factors expected to drive military expenditure. Furthermore, the instability in neighboring Libya, coupled with the rapid spread of Islamic State (IS) in the country, has compelled Algeria to bolster its defenses and develop a robust defense posture. The Algerian defense industry is expected to grow to US$11.9 billion by 2023 at a CAGR of 4.31%.

Algeria has observed a marked decline in instances of violent attacks perpetuated by armed insurgent groups. The country’s political and economic measures to de-radicalize its population have succeeded to a great extent, and the country has managed to significantly limit the influence of foreign terrorist organizations such as Al-Qaeda in the Islamic Maghreb (AQIM). As such, Algeria does not face any urgent internal threats to justify expansive spending on the homeland security sector. As its homeland security (HLS) expenditure stands at US$3.7 billion in 2019 and is expected to increase at a minimal CAGR of 1.64% over the forecast period to reach US$4.0 billion in 2023.

Historically, Russian defense firms have entered the Algerian defense industry through government initiated foreign military sales. The country is increasing its efforts to reduce its military dependency on foreign suppliers and, therefore, is largely concentrating on the joint development of defense systems to strengthen its domestic defense manufacturing capabilities. Furthermore, Algeria has witnessed a number of JVs with Algerian, Russian, French, and Serbian companies in areas such as armored vehicles, unmanned aircraft, military healthcare, and counter-terrorism equipment

This report offers detailed analysis of the Algerian 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.

Scope

In particular, it provides an in-depth analysis of the following -

• The Algerian defense industry market size and drivers: detailed analysis of the Algerian defense industry during 2019-2023, 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
  
• Import and Export Dynamics: analysis of prevalent trends in the country’s imports and exports over the last five years
  
• Market opportunities:list of the top ten defense investment opportunities over the next 5 years
  
• Competitive landscape and strategic insights: analysis of the competitive landscape of the Algerian defense industry.
  

Reasons to buy

• This report will give the user confidence to make the correct business decisions based on a detailed analysis of the Algerian 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
  
• Profiles of the top domestic and foreign defense manufacturers. This will provide the user with a total competitive landscape of the sector.
  
• A deep qualitative analysis of the Algerian defense industry covering sections including demand drivers, Key Trends , and latest industry contracts.