Market Size of Eastern Europe Defense Industry
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 3.93 Billion |
| Market Size (2029) | USD 4.76 Billion |
| CAGR (2024 - 2029) | 3.91 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Eastern Europe Defense Market Analysis
The Eastern Europe Defense Market size is estimated at USD 3.93 billion in 2024, and is expected to reach USD 4.76 billion by 2029, growing at a CAGR of greater than 3.91% during the forecast period (2024-2029).
The military expenditure of the region continued to increase, driven by the regional conflicts and the push for modernization. According to SIPRI, the defense spending of the countries in the region totaled USD 181 billion in 2023, an increase of 31% compared to that of 2022 and 118% higher than that of 2014.
Furthermore, the Russian invasion of Ukraine, the most significant armed conflict in the region since the Second World War, is expected to propel the defense spending of the region in the years to come. Countries in the region are going through many military modernization plans, and they are planning to upgrade their armed, naval, and air forces. Such factors may drive the market in the coming years. The growing perceptions of the threat from Russia and calls from the United States to the NATO countries to increase their defense spending will be the growth drivers for the market.
The industry faces challenges due to the high costs of advanced technologies. Developing and deploying cutting-edge systems, including sophisticated sensors, EO/IR systems, and unmanned platforms, involves substantial investments. The high cost poses a barrier for some entities, hindering the adoption and creating a challenge for the industry.
Eastern Europe Defense Industry Segmentation
Bulgaria, Hungary, the Czech Republic, Ukraine, Moldova, Belarus, Russia, Slovakia, Romania, and Poland are the countries considered in Eastern Europe per the UN Statistics Division. The report includes revenues from procurement and aftermarket services. The weapons and ammunition segment includes artillery and mortar systems, infantry weapons, missiles, missile defense systems, and small, medium, and large-caliber ammunition.
The report is segmented by type into personnel training and protection, communication systems, weapons and ammunition, and vehicles. By country, the market is segmented into Poland, Russia, Hungary, Romania, and Rest of Eastern Europe. The report also offers the market size and forecasts for four countries across the region. For each segment, the market sizing and forecasts were made based on value (USD).
| By Type | |
| Personnel Training and Protection | |
| Communication Systems | |
| Weapons and Ammunition | |
| Vehicles |
| By Country | |
| Poland | |
| Russia | |
| Hungary | |
| Romania | |
| Rest of Eastern Europe |
Eastern Europe Defense Market Size Summary
The Eastern Europe defense market is experiencing significant growth, driven by increased military expenditure and modernization efforts across the region. The ongoing regional conflicts, particularly the Russian invasion of Ukraine, have heightened security concerns, prompting countries to bolster their defense capabilities. This has led to a surge in defense spending, with nations focusing on upgrading their armed, naval, and air forces. The push for modernization is further supported by calls from the United States for NATO countries to increase their defense budgets. However, the industry faces challenges due to the high costs associated with advanced technologies, which can hinder the adoption of cutting-edge systems.
Poland is poised for substantial growth within the Eastern Europe defense market, as it continues to transform its military into a more modern and NATO-compatible force. The country has significantly increased its defense spending, partly through an off-budget funding mechanism, to support extensive modernization efforts. Poland's strategic initiatives include expanding its armed forces, enhancing air defense systems, and developing advanced weaponry and vehicles. The market is semi-consolidated, with major players like Rostec, BAE Systems, and Rheinmetall AG actively participating. Local manufacturers are also strengthening their presence through increased production capabilities and joint ventures, capitalizing on opportunities for further military upgrades in countries such as Romania and Bulgaria.
Eastern Europe Defense Market Size - Table of Contents
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1. MARKET DYNAMICS
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1.1 Market Overview
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1.2 Market Drivers
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1.3 Market Restraints
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1.4 PESTLE Analysis
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2. MARKET SEGMENTATION
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2.1 By Type
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2.1.1 Personnel Training and Protection
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2.1.2 Communication Systems
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2.1.3 Weapons and Ammunition
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2.1.4 Vehicles
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2.2 By Country
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2.2.1 Poland
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2.2.2 Russia
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2.2.3 Hungary
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2.2.4 Romania
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2.2.5 Rest of Eastern Europe
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Eastern Europe Defense Market Size FAQs
How big is the Eastern Europe Defense Market?
The Eastern Europe Defense Market size is expected to reach USD 3.93 billion in 2024 and grow at a CAGR of greater than 3.91% to reach USD 4.76 billion by 2029.
What is the current Eastern Europe Defense Market size?
In 2024, the Eastern Europe Defense Market size is expected to reach USD 3.93 billion.
