Thailand - Country Commercial Guide
Defense and Security

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2019-10-13

This is a best prospect industry sector for this country and includes a market overview and trade data.

Overview>

The Thai military and law enforcement agencies set the agenda for National Security Strategy, which primarily focuses on maintaining defense expenditures to sufficiently safeguard the nation and strengthen the armed forces to protect the country’s interests. Thailand purchases military equipment to modernize and upgrade military capability.  Demand for military and defense equipment from allied countries, including the United States, remains high.

The nature of security threats in Thailand include potential political unrest, occasional border disputes, domestic terrorist and separatist group activities in the troubled southern provinces, natural disasters, human smuggling, and illicit drug trafficking.

Since the economic crisis of the late 1990s, Thai defense budgets have continued to increase every year in an effort to maintain combat readiness, neutralize the regional arms race among Associations of Southeast Asian Nations (ASEAN), and modernize the country’s armed forces. The United States has been one of the largest sources of defense equipment to the country.

For 2019, Thai government will allocate 1.29% of the country’s GDP to defense, which is approximately $7.3 billion.  An estimated 49% of the defense budget is assigned to the Royal Thai Army, another 20.03% is allocated to the Royal Thai Navy, and 18.32% is for the Royal Thai Air Force. The remaining funds are distributed to the Office of the Permanent Secretary and Defense Technology Institute (DTI) for research and development.

 

2017

2018

2019

2020 (Estimated)

Defense Budget

 6,032.16

 7,048.49

 7,326.66

 7,619.73

Gross Domestic Product (GDP)

 425,037.14

 518,267.74

 566,451.61

 589,109.68

Defense Budget in% to GDP

1.42%

1.36%

1.29%

1.29%

Annual Increase

3.08%

16.85%

3.95%

4.00%

Scale:  $ U.S. Million

Leading Sub-Sectors>

Security and Safety Equipment (SEC)
Airport and Ground Support Equipment (APG)
Aircraft and Parts (AIR)
Aviation Services (AVS)

 

Opportunities>

Government and military expenditures drive the Thai defense and equipment market, and increased budgets since 2014 expanded the market.  The factors that drive defense expenditures are the threat levels, equipment maintenance, replacement, and overhaul or refurbishment requirements.  There is a potential for growth in the Thai military budget since levels have been less than 1.5% of the national GDP, compared to leading countries in ASEAN (such as Singapore at 3.3 %, Brunei at 2.9%, and Vietnam at 2.3%).

The Thai Ministry of Defense introduced a military reform and restructuring plan for 2017 to 2026.  The plan emphasizes research and development along with a focus on purchases of munitions, weapons, military vehicles, training aircraft, high technology electronic and communication devices.  To upgrade military capabilities, the Thai military will invest in additional purchases of helicopters, armored vehicles, and utility vehicles  to counter a southern insurgency and strengthen its border security and current military units.
In addition, the Thai government plans to develop the domestic defense industry to reduce the country’s dependence on imports, promote technology transfer, and strengthen national security.

 

Web Resources>

Ministry of Defense
Foreign Affairs Division, Office of Policy and Planning,
Tel: 662-225-7414, Fax: 662-226-1839
Royal Thai Armed Force Headquarters
Office of Policy and Plans, Directorate of Joint Operations,
Tel: 662-575-6203, Fax: 662-575-6067
Royal Thai Army
Policy and Plans Division
Directorate of Logistics
Tel: 662-297-7424, Fax: 662-297-7420
Defense Technology Institute(DTI), Ministry of Defense,
The Kingdom of Thailand
47/433, 4th Floor - Office of the Permanent Secretary of Defense Building. Changwattana Road., Pakkred, Nonthaburi 11120
Tel: +66 (0) 2980 6612-15, Fax: +66 (0) 2980 6688