Ballistic missile production and ballistic missile defense driving strong East Asia missile market
Four countries in East Asia, China, Japan, South Korea and Taiwan, are expected to spend a combined total of USD55.7 billion on missiles from 2017 to 2026, according to Jane's analysts. Ballistic missile production is forecast to be worth 30 percent of this market, while missile defense will account for 16 percent.
According to Jane's Markets Forecast, the 10-year missile market in China is forecast to have a value of USD37.7 billion with 44 percent of it, or USD16.6 billion, dedicated to the development and procurement of new ballistic missiles. China is currently undergoing a significant modernization effort with the People's Liberation Army (PLA) Rocket Force replacing older liquid-fueled missiles, such as the DF-5, with missiles with solid fuel propellant, such as the DF-41. However, there is also greater potential for medium and intermediate range ballistic missiles to be used as tactical rather than strategic weapons. In addition to forming part of China's nuclear deterrent, the PLA Rocket Force's missiles can be armed with a variety of conventional warheads in order to be used as long-range artillery.
Perhaps the most significant role for China's ballistic missiles is as part of its wider anti-access/area denial (A2/AD) strategy, with variants of the DF-21 MRBM and DF-26 IRBM developed as anti-ship ballistic missiles. This strategy, intended to maintain influence in the Western Pacific in competition with the United States, is a major driver of Chinese missile procurement.
As well as ballistic missiles, China is looking to pursue an A2/AD strategy through the deployment of new air and missile defense capabilities, such as the procurement of S-400 batteries from Russia. Such a move is intended to deter incursions into Chinese territory by both aircraft and potential long-range strike weapons.
Ballistic missile developments in North Korea also act as a key missile procurement driver for Japan and South Korea, with both countries looking to strengthen their missile defenses. In Japan, the introduction of the SM-3 Block IIA missile is expected to account for the majority of the Japanese missile market, with approximately 36 interceptors. The Japanese missile market is forecast to amount to a total of USD2.1 billion for the next 10 years.
South Korea is currently in the process of augmenting its patriot batteries with the locally developed Cheongung air and missile defense system. The Cheongung system will replace South Korea's HAWK batteries and has been specifically designed to intercept short-range ballistic missiles. While South Korea is currently receiving support from the United States for missile defense, in the form of Patriot PAC-3 and THAAD batteries deployed on the peninsular, the future is likely to see a move towards a greater use of locally developed systems. This can be seen through the deployment of the Cheongung system and also in South Korea's efforts to develop an exo-atmospheric interception capability for Cheongung, Cheolmae 4-H. This would provide a capability similar to THAAD. South Korea is expected to spend USD10.8 billion on missiles for the next 10 years.
For Taiwan, as with South Korea, there is a focus on air defense with the introduction of the locally produced Tien Kung 3 air defense system to replace HAWK. Taiwan is also receiving Patriot PAC-3 interceptors from the United States in a further effort to bolster its missile defenses. However, given the large scale of the PLA's missile inventory in South East China, it is questionable how effective such defenses could be.
The content from this blog post is compiled from Jane's industry solutions. To request a demonstration or for more information, visit Jane's industry solutions.
Jane's Editorial Staff
Posted 16 August 2017
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