Vietnam largely relies on foreign original equipment manufacturers (OEMs) to fulfil its military requirements, as it possesses limited indigenous defence industrial capability, according to a report by Strategic Defence Intelligence (SDI).

Titled ‘Future of the Vietnam defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2022’, the report offers insights of the Vietnamese defence industry.

Russia was the biggest exporter of defence equipment and systems to Vietnam with a share of approximately 88.2% of Vietnam’s imports during 2012-2016, followed by Belarus, Ukraine and Israel, which accounted for 3.5%, 2.8% and 2.7% respectively.

“Russia was the biggest exporter of defence equipment and systems to Vietnam.”

Vietnam imported naval vessels, aircraft, missiles, air defence systems, sensors and engines during the last five years. The nation permits the entry of foreign OEMs into the market through government-to-government deals and direct commercial sales.

Despite the fact that the undeveloped Vietnam domestic defence industry creates abundant opportunities for foreign OEMs, lack of transparency in budget allocation and procurement programmes coupled with the wide-spread corruption hinder the entry of foreign defence companies.