Industry Analysis & Industry Trends
Over the past five years, the Global Military Shipbuilding and Submarines industry was greatly impacted by declining defense spending in the United States and Europe. The global economic slowdown stunted industry growth as western governments attempted to deal with widening budget deficits by cutting defense spending, which led to less funding for industry programs. However, despite western military budget cuts, demand remained fairly robust, with industry revenue only expected to increase marginally over the five years to 2016. Over the next five years, continued economic growth and geopolitical tensions in Asia are anticipated to encourage more countries in the region to spend on industry products, bumping revenue higher.
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While international trade in the industry is moderate, global production of military ships and submarines is centered in North America, Europe and Asia. Government support is usually available in the industry as many nations provide substantial subsidies to their shipbuilding and repair industries. Maintaining a shipbuilding industrial base, both civil and military, helps to safeguard a nation's control over getting its products to foreign markets and ensures that it will have the means to replace its merchant or naval fleets in a time of national emergency. Therefore, unlike many other industries, the policies of national governments, together with economic forces, dictate economic activity in this industry... read more