Press Release

Contact:  Stu Slade, Defense Analyst

Phone: (203) 426-0800

Fax: (203) 426-4262

Web site: www.forecast1.com

E-mail: stu.slade@forecast1.com

Forecast International, Inc.

22 Commerce Rd. Newtown, CT  06470 USA

 

FOR IMMEDIATE RELEASE

Sustained Defense Market Recovery in Far East

 

NEWTOWN, Conn. [December 1, 2004] — Forecast International's latest figures for total defense spending across the Pacific Rim and Far East show an aggregate of  $133.4 billion, and during the 2005-2009 period the company anticipates a steady increase in total defense spending.  "Asia Pacific Market Analysis" expects that in 2009 the region's defense expenditures will rise by 11.5 percent to $157.3 billion, an annual 2.8 percent average increase that is approximately in line with the average rates of inflation across the region.

 

This increase is an inevitable result of the deep cuts resulting from the 1997 economic crisis, when funding for maintenance and modernization was slashed, and urgently needed upgrades delayed or discarded.  The result is a bow wave of urgently needed operations and support programs.  Added to this is the perception that much of the area's military inventory has become obsolete. 

 

"Defense expenditures are also on the increase in response to terrorism spreading across the Pacific Rim and Far East," said the report's author, defense analyst Stu Slade. "Those countries feeling the effects right now include Pakistan, India, Thailand, Indonesia and the Philippines, but the spread is unlikely to stop there."

 

Although the items required by counter-insurgency efforts – body armor, rifles, four-wheel drive vehicles and communications equipment – are not individually expensive,  the quantities in which they are required make them a burden on a stretched defense budget. Counter-insurgency is a long-haul business, a factor that makes it certain that this part of the defense budgets will not see a reduction soon.

 

"Asia Pacific Market Analysis" examines the leading countries in the region ranked by their total estimated defense budgets over the next five years.  The leading country is Japan, with a five-year defense budget projection of $209.6 billion, representing 27.9 percent of the projected regional defense budget. As might be expected, China follows with $147.0 billion (19.6 percent), followed by South Korea at $95.5 billion (12.7 percent).  India and Australia are next, with $77.2 billion (10.2 percent) and $68.2 billion (9.1 percent), respectively. 

 

As a result of various discrepancies in accounting standards between nations, a direct national comparison can be misleading.  However, once due allowance for this factor is made, the pattern that emerges is still distinct: defense expenditures in the Pacific Rim and Far East are rebounding from the lows of the previous five years, and look set for a steady and sustained recovery. 

 

Forecast International, Inc. is a leading provider of Market Intelligence and Analysis in the areas of aerospace, defense, power systems and military electronics.  Based in Newtown, CT, USA, Forecast International specializes in long-range industry forecasts and market assessment - utilized by strategic planners, marketing professionals, military organizations, and governments - worldwide.  To arrange an interview with Forecast International's analysts, please contact Monty Nebinger (203-426-0800, monty.nebinger@forecast1.com