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Future of the Mexican Defense Industry – Market

Attractiveness, Competitive Landscape and

Forecasts to 2020

Future of the Mexican Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to 2020

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Summary

“Future of the Mexican Defense Industry – Market Attractiveness, Competitive Landscape and Forecasts to

2020” report offers the reader detailed analysis of the defense budget over the next five years. Alongside it

offers insights into the market opportunities and entry strategies adopted by foreign OEMs (original

equipment manufacturers) to gain a market share in the Mexican defense industry.

The report provides detailed analysis of the current industry size and growth expectations during 2016–

2020, including highlights of the key growth stimulators. It also benchmarks the industry against key global

markets and provides detailed understanding of emerging opportunities in specific areas.

Key Findings

The Mexican defense budget values US$XX billion in 2015, and recorded a CAGR of XX% during the

historic period. The expenditure is anticipated to grow at a CAGR of XX% over the forecast period to value

US$XX billion in 2020. The Mexican defense budget is mainly driven by the modernization efforts to

replace its aging military hardware, especially the aircraft fleet, and the country’s vulnerability to drug wars.

In addition, capital expenditure is expected to record a CAGR of XX% over the forecast period to value

US$XX million in 2020. On a cumulative basis, the country is estimated to spend US$XX billion on the

procurement of defense equipment. Over the forecast period, demand for equipment is expected to mainly

revolve around multi-role aircraft, military helicopters, corvettes, and transport helicopters. The remaining

budget will be allocated to revenue expenditure, which includes salaries of personnel, operational

expenses, and training and development.

Key Features and Benefits

The report provides detailed analysis of the Mexican defense industry during 2011–2020, including the

factors that influence the military expenditure. It provides detailed expectations of growth rates and

projected total expenditure.

It provides the manufacturers with insights on market opportunities along with industry structure and

dynamics prevalent in the country. In addition, the report focuses on the regulations governing the Mexican

defense industry and the potential market entry strategies with an expert analysis of the competitive

structure.


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1. Market Attractiveness and Emerging Opportunities

1.1. Defense Market Size Historical and Forecast

1.1.1. Mexican defense expenditure expected to register a CAGR of XX% over the forecast period

In 2015, the Mexican MoD allocated US$XX billion to its total defense budget, registering a CAGR of XX%

during 2011–2015. During the forecast period, the country’s defense budget is expected to register a CAGR

of XX% to value US$XX billion in 2020. The modernization of the armed forces along with the procurement of

advanced defense systems to combat drug trafficking is expected to drive Mexican defense expenditure

during 2016–2020. On a cumulative basis, defense expenditure over the forecast period is expected to be

US$XX billion, compared to US$XX billion spent during 2011–2015.

The following table and figure show the Mexican defense expenditure during the historic period:

Table 1: Mexican Defense Expenditure ( US$ Billion), 2011–2015

Year Defense expenditure (US$ bn)

Defense growth percentage

2011

2012

2013

2014

2015

CAGR 2011–2015

Source: Ministry of Defense and SDI analysis © SDI

Figure 1: Mexican Defense Expenditure (US$ Billion), 2011–2015


-5%

0%

5%

10%

15%

20%

25%

30%

35%

0

1

2

3

4

5

6

2011 2012 2013 2014 2015

Gro

wth

rate

(%)

Def

ense

exp

end

itu

re (U

S$

Bill

ion

)

Defense expenditure (US$ bn) Defense growth percentage


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The following table and figure show projected defense expenditure of the Mexican over the forecast period:

Table 2: Mexican Defense Expenditure (US$ Billion), 2016–2020

Year Defense expenditure (US$ bn)

Defense growth percentage

2016

2017

2018

2019

2020

CAGR 2016–2020


Figure 2: Mexican Defense Expenditure (US$ Billion), 2016–2020


0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

0

1

2

3

4

5

6

7

2016 2017 2018 2019 2020G

row

th r

ate

(%

)

De

fen

se

ex

pe

nd

itu

re (

US

$ B

illi

on

)

Defense expenditure (US$ bn) Defense growth percentage


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1.2. Analysis of Defense Budget Allocation

1.2.1. Share of capital expenditure expected to increase over forecast period

During 2011–2015, an average of XX% of the country’s total defense budget was allotted to capital

expenditure, while an average of XX% was reserved for revenue expenditure. Over the forecast period,

capital expenditure is expected to increase at an average of XX%. This increase is primarily due to a number

of procurements and modernization programs formulated by the government. The remaining defense budget

is allotted to revenue expenditure, which includes personnel salaries, and the operations and maintenance

costs of equipment and defense facilities.

The following table and chart display the Mexican defense budget share of capital and revenue expenditure

during the historic period:

Table 3: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2011–2015

Year Capital Expenditure Share Revenue Expenditure Share

2011

2012

2013

2014

2015

Source: Ministry of Defense, Mexico and SDI analysis © SDI

Figure 3: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2011–2015


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2011 2012 2013 2014 2015

Def

ense

Bud

get

Spl

it (%

)

Capital Expenditure Share Revenue Expenditure Share


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The following table and chart display the Mexican defense budget share of capital and revenue expenditure

over the forecast period:

Table 4: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2016–2020

Year Capital Expenditure Share Revenue Expenditure Share

2016

2017

2018

2019

2020

Source: Ministry of Defense, Mexico and SDI analysis © SDI

Figure 4: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2016–2020


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2016 2017 2018 2019 2020

Defe

nse B

ud

get

Sp

lit

(%)

Capital Expenditure Share Revenue Expenditure Share


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1.3. Homeland Security Market Size and Forecast

1.3.1. Mexican homeland security expected to grow at a steady pace

In 2015, Mexican homeland security expenditure stands at US$XX billion, and registered a CAGR of XX%

during the historic period. Moreover, it is estimated to register a CAGR of XX% over the forecast period to

value US$XX billion in 2020. Mexico’s homeland security expenditure is primarily used to maintain internal

security, law enforcement, and prevent crime. In January 2013, after President Enrique Peña Nieto took

office, the country observed a structural change in its internal affairs when the Secretariat of Public Security

(SSP), which was responsible for internal security including the police and other government departments,

was dissolved. Responsibility has since been passed to the Interior Ministry for Security and Coordination. In

August 2014, the President launched the Gendarmerie, under the federal police division, consisting of 5,000

trained officers who are responsible for protecting the economic assets of industries, farms, and businesses

that have been targeted by organized criminal groups.

The table and chart below show the Mexican homeland security expenditure during the historic period:

Table 5: Mexican Homeland Security Expenditure (US$ Billion), 2011–2015

Year Homeland expenditure (US$ million)

% Growth

2011

2012

2013

2014

2015

Source: Ministry of Finance, Mexico and SDI analysis © SDI

Figure 5: Mexican Homeland Security Expenditure (US$ Billion), 2011–2015

Source: Ministry of Finance, Mexico and SDI analysis © SDI

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

0

1

2

3

4

5

6

7

2011 2012 2013 2014 2015

Gro

wth

rate

(%)

Hom

elan

d Se

curit

y ex

pend

iture

(US$

Bill

ion)

Homeland Security Budget (US$ bn) Growth rate (%)


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2. Industry Dynamics - Porter’s Five Forces Analysis

Figure 4: Industry Dynamics – Porter’s Five Forces Analysis

Source: SDI analysis © SDI

Intensity of Rivalry Bargaining Power of Supplier

Bargaining Power of Buyer

Barrier to Entry

Threat of Substitute


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Report Methodology

SDI’s dedicated research and analysis teams consist of experienced professionals with a background in

industry research and consulting in the defense sector. The following research methodology is followed for all

databases and reports:

Secondary Research

The research process begins with exhaustive secondary research to source reliable qualitative and

quantitative information related to the defense market. The secondary research sources that are typically

referred to include, but are not limited to:

Industry associations

National government documents and statistical databases

Company websites, annual reports, financial reports, broker reports, investor presentations

Industry trade journals and other literature

Internal and external proprietary databases

News articles, press releases, and webcasts specific to the companies operating in the market

Primary Research

SDI conducts hundreds of primary interviews a year with industry participants and commentators in order to

validate its data and analysis. A typical research interview fulfills the following functions:

Provides first-hand information on market size, market trends, growth trends, competitive landscape,

and future outlook

Helps to validate and strengthen secondary research findings

Further develops the analysis team’s expertise and market understanding

Primary research involves e-mail interactions, telephone interviews, and face-to-face interviews for

each market category, division, and sub-division across geographies

The participants who typically take part in such a process include, but are not limited to:

Industry participants: CEOs, VPs, business development managers, market intelligence managers,

and national sales managers

External experts: investment bankers, valuation experts, research analysts, and key opinion leaders

specializing in defense markets

Conventions

Currency conversions are performed on the basis of average annual conversion rate format

calculations

All the values in tables, with the exception of compounded annual growth rate (CAGR) and

compounded annual rate of change (CARC), are displayed to one decimal place; therefore, due to

this rounding method, growth rates may appear inconsistent with absolute values

The forecasted values are projected on the basis of nominal values; the inflation was not taken into account


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TABLE OF CONTENTS

1. Introduction ........................................................................................................................... 8

1.1. What is this Report About? ........................................................................................................... 8

1.2. Definitions ...................................................................................................................................... 8

1.3. Summary Methodology .................................................................................................................11

1.4. SDI Terrorism Index ......................................................................................................................12

1.5. About Strategic Defence Intelligence ..........................................................................................12

2. Executive Summary ............................................................................................................ 13

3. Market Attractiveness and Emerging Opportunities ........................................................ 16

3.1. Defense Market Size Historical and Forecast..............................................................................17

3.1.1. Defense expenditure is projected to grow at a CAGR of XX% during 2016–2020 .................................. 17

3.1.2. The government’s fight against drug trafficking to drive defense expenditure in the forecast period ...... 21

3.1.3. Defense expenditure as a percentage of GDP estimated to increase over the forecast period .............. 23

3.1.4. Per capita defense expenditure forecast to increase over the forecast period ........................................ 25

3.2. Analysis of Defense Budget Allocation .......................................................................................26

3.2.1. Share of capital expenditure to average XX% during the forecast period ................................................ 27

3.2.2. Mexican defense capital expenditure is expected to grow at a CAGR of XX% during the forecast

period .................................................................................................................................................................. 29

3.3. Homeland Security Market Size and Forecast ............................................................................33

3.3.1. Homeland security expenditure is anticipated to increase at a CAGR of XX% during the forecast period33

3.3.2. Organized crime and money laundering to drive the HLS market............................................................ 37

3.3.3. Mexico considered at ‘some risk’ of terrorist attack .................................................................................. 39

3.4. Benchmarking with Key Global Markets .....................................................................................41

3.4.1. Mexico’s defense budget expected to increase over the forecast period ................................................ 41

3.4.2. Mexico’s military expenditure is limited compared to countries with the largest defense expenditures .. 43

3.4.3. Mexico allocates a low percentage of GDP to defense ............................................................................ 44

3.4.4. Mexico suffers “some risk” level of terrorist activity .................................................................................. 45

3.5. Market Opportunities: Key Trends and Growth Stimulators ......................................................47

3.5.1. Multi-role Aircraft ....................................................................................................................................... 47

3.5.2. Military Helicopters ................................................................................................................................... 48

3.5.3. Corvettes .................................................................................................................................................. 49

3.5.4. Transport Aircraft ...................................................................................................................................... 50

4. Defense Procurement Market Dynamics ........................................................................... 51

4.1. Import Market Dynamics ...............................................................................................................52

4.1.1. Limited domestic defense capabilities drives the country’s defense imports ........................................... 52

4.1.2. The US was a major arms supplier to Mexico during 2010–2014 ............................................................ 53


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4.1.3. Aircraft to dominate Mexican defense imports ......................................................................................... 54

4.2. Export Market Dynamics ..............................................................................................................55

4.2.1. Mexico does not export arms due to an underdeveloped domestic arms industry .................................. 55

5. Industry Dynamics .............................................................................................................. 56

5.1. Five Forces Analysis.....................................................................................................................56

5.1.1. Bargaining power of the supplier: low ....................................................................................................... 57

5.1.2. Bargaining power of the buyer: medium ................................................................................................... 57

5.1.3. Barriers to entry: low ................................................................................................................................. 57

5.1.4. Intensity of rivalry: low .............................................................................................................................. 57

5.1.5. Threat of substitution: medium to high ..................................................................................................... 57

6. Market Entry Strategy ......................................................................................................... 58

6.1. Market Regulation .........................................................................................................................58

6.1.1. Mexico has not disclosed any offset obligations ...................................................................................... 58

6.1.2. Mexico allows 100% FDI in defense industry ........................................................................................... 58

6.2. Market Entry Route .......................................................................................................................59

6.2.1. Foreign OEMs prefer direct selling to enter the market ............................................................................ 59

6.2.2. Military collaborations provide good market entry opportunities .............................................................. 59

6.3. Key Challenges .............................................................................................................................60

6.3.1. Corruption and lack of transparency impedes the growth of Mexico’s defense industry ......................... 60

6.3.2. Lack of domestic defense technological know-how acts as a deterrent to market entry ......................... 61

7. Competitive Landscape and Strategic Insights ................................................................ 62

7.1. Competitive Landscape Overview ...............................................................................................62

7.2. Key Domestic Companies ............................................................................................................62

7.2.1. Productos Mendoza: overview ................................................................................................................. 62

7.2.2. Productos Mendoza: products .................................................................................................................. 62

7.2.3. Aviabaltika de Mexico Company: overview .............................................................................................. 63

7.2.4. Aviabaltika de Mexico Company: products and services ......................................................................... 63

8. Business Environment and Country Risk ......................................................................... 64

8.1. Demographics & Social Statistics ................................................................................................64

8.1.1. Total Rural Population .............................................................................................................................. 64

8.1.2. Total Urban Population ............................................................................................................................. 65

8.1.3. Number of households.............................................................................................................................. 66

8.2. Economic Performance ................................................................................................................67

8.2.1. GDP Per Capita ........................................................................................................................................ 67

8.2.2. GDP, Current Prices ................................................................................................................................. 68

8.2.3. Consumer Price Index .............................................................................................................................. 69

8.2.4. Wholesale Price Index .............................................................................................................................. 70


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8.2.5. Local Currency Unit per Euro ................................................................................................................... 71

8.2.6. Lending Rate ............................................................................................................................................ 72

8.2.7. Real Interest Rate ..................................................................................................................................... 73

8.2.8. Market Capitalization of Listed Companies .............................................................................................. 74

8.2.9. Market Capitalization of Listed Companies (% of GDP) ........................................................................... 75

8.2.10. Goods exports as % of GDP .................................................................................................................... 76

8.2.11. Goods imports as % of GDP .................................................................................................................... 77

8.2.12. Goods Trade Surplus/Deficit as % of GDP............................................................................................... 78

8.2.13. Service Imports as % of GDP ................................................................................................................... 79

8.2.14. Service Exports as % of GDP ................................................................................................................... 80

8.2.15. Service Trade Surplus/Deficit as % of GDP ............................................................................................. 81

8.2.16. Foreign Direct Investment......................................................................................................................... 82

8.2.17. Net foreign direct investment as % of GDP .............................................................................................. 83

8.2.18. International reserves, including gold ....................................................................................................... 84

8.3. Energy and Utilities .......................................................................................................................85

8.3.1. Conventional Thermal Electricity Net Generation .................................................................................... 85

8.3.2. Hydroelectricity Net Generation ................................................................................................................ 86

8.3.3. Nuclear Electricity Net Generation ........................................................................................................... 87

8.3.4. Conventional Thermal Electricity Installed Capacity ................................................................................ 88

8.3.5. Electricity Exports ..................................................................................................................................... 89

8.3.6. Electricity Imports ..................................................................................................................................... 90

8.3.7. Proved Natural Gas Reserves .................................................................................................................. 91

8.3.8. Petroleum Consumption ........................................................................................................................... 92

8.4. Infrastructure .................................................................................................................................93

8.4.1. Air transport, freight .................................................................................................................................. 93

8.5. Minerals .........................................................................................................................................94

8.5.1. Mining, Manufacturing, Utilities Output ..................................................................................................... 94

8.6. Technology ....................................................................................................................................95

8.6.1. Patents Granted ........................................................................................................................................ 95

8.7. Telecommunication ......................................................................................................................96

8.7.1. Telephone Lines ....................................................................................................................................... 96

8.7.2. Telephone Lines Penetration Rate ........................................................................................................... 97

9. Appendix .............................................................................................................................. 98

9.1. About SDI .......................................................................................................................................98

9.2. Disclaimer ......................................................................................................................................98


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LIST OF FIGURES

Figure 1: Mexican Defense Expenditure (US$ Billion), 2011–2015 ..................................................................................................................... 17 Figure 2: Mexican Defense Expenditure (US$ Billion), 2016–2020 ..................................................................................................................... 18 Figure 3: Mexican Defense Expenditure (in MXN billion), 2011–2015 ................................................................................................................. 19 Figure 4: Mexican Defense Expenditure (in MXN billion), 2016–2020 ................................................................................................................. 20 Figure 5: Mexican GDP Growth vs. Defense Expenditure Growth vs. Defense Expenditure as a Percentage of GDP, 2011–2015 ..................... 23 Figure 6: Mexican GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as a Percentage of GDP, 2016–2020 .................. 24 Figure 7: Mexican Per Capita Defense Expenditure (US$), 2011–2015 .............................................................................................................. 25 Figure 8: Mexican Per Capita Defense Expenditure (US$), 2016–2020 .............................................................................................................. 26 Figure 9: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2011–2015 ............................................................... 27 Figure 10: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2016–2020 ............................................................. 28 Figure 11: Mexican Capital Budget Allocation (US$ Million), 2011–2015 ............................................................................................................ 29 Figure 12: Mexican Capital Budget Allocation (US$ Million), 2016–2020 ............................................................................................................ 30 Figure 13: Mexican Capital Budget Allocation (MXN Billion), 2011–2015 ............................................................................................................ 31 Figure 14: Mexican Capital Budget Allocation (MXN Billion), 2016–2020 ............................................................................................................ 32 Figure 15: Mexican Homeland Security Budget (US$ billion), 2011–2015 ........................................................................................................... 33 Figure 16: Mexican Homeland Security Budget (US$ billion), 2016–2020 ........................................................................................................... 34 Figure 17: Mexican Homeland Security Budget (MXN Billion), 2011–2015 ......................................................................................................... 35 Figure 18: Mexican Homeland Security Budget (MXN Billion), 2016–2020 ......................................................................................................... 36 Figure 19: SDI Terrorism Heat Map, 2015 .......................................................................................................................................................... 39 Figure 20: SDI Terrorism Index, 2015 ................................................................................................................................................................. 40 Figure 21: Benchmarking with Key Markets – 2011–2015 vs. 2016–2020 .......................................................................................................... 42 Figure 22: Defense Expenditure of the World’s Largest Military Spenders (US$ Billion), 2015 and 2020 ........................................................... 43 Figure 23: Defense Expenditure as a Percentage of GDP of Largest Military Spenders (%), 2015 ..................................................................... 44 Figure 24: Multi-role Aircraft Market Size (US$ Million), 2015–2025 .................................................................................................................. 47 Figure 25: Military Helicopter Market Size (US$ Million), 2015–2025 .................................................................................................................. 48 Figure 26: Corvettes Market Size (US$ Million), 2015–2025 ............................................................................................................................... 49 Figure 27: Transport Aircraft Market Size (US$ Million), 2015–2025 ................................................................................................................... 50 Figure 28: Mexican Defense Imports (TIV values) 2010–2014 ............................................................................................................................ 52 Figure 29: Mexican Defense Imports by Country (%), 2010–2014 ...................................................................................................................... 53 Figure 30: Mexican Defense Imports by Category (%), 2010–2014 .................................................................................................................... 54 Figure 31: Industry Dynamics Porter’s Five Forces Analysis ............................................................................................................................... 56 Figure 32: Mexican Rural Population (In Millions), 2015–2024 ........................................................................................................................... 64 Figure 33: Mexican Urban Population (In Millions), 2015–2024 ......................................................................................................................... 65 Figure 34: Mexican Number of Households (In Millions), 2008–2017 ................................................................................................................. 66 Figure 35: Mexican GDP Per Capita, 2015–2024 ............................................................................................................................................. 67 Figure 36: Mexican GDP, Current Prices (US$ Billion), 2015–2024 ................................................................................................................... 68 Figure 37: Mexican Consumer Price Index, 2015–2024 ..................................................................................................................................... 69 Figure 38: Mexican Wholesale Price Index, 2003–2012..................................................................................................................................... 70 Figure 39: Local Currency per Euro, 2015–2024 ................................................................................................................................................ 71 Figure 40: Lending Rate, 2003–2012 .................................................................................................................................................................. 72 Figure 41: Real Interest Rate, 2003–2012 .......................................................................................................................................................... 73 Figure 42: Mexican Market Capitalization of Listed Companies (US$ Billion), 2003–2012 ................................................................................. 74 Figure 43: Mexican Market Capitalization of Listed Companies (% of GDP), 2002–2011 ................................................................................... 75 Figure 44: Mexican Goods Exports as % of GDP, 2002–2011 ........................................................................................................................... 76 Figure 45: Mexican Goods Imports as % of GDP, 2002–2011 ........................................................................................................................... 77 Figure 46: Mexican Goods Trade Surplus/Deficit as % of GDP, 2002–2011 ...................................................................................................... 78 Figure 47: Mexican Service Imports as % of GDP, 2002–2011 ........................................................................................................................... 79 Figure 48: Mexican Service Exports as % of GDP, 2002–2011 .......................................................................................................................... 80 Figure 49: Mexican Service Trade Surplus/Deficit as % of GDP, 2002–2011 ..................................................................................................... 81 Figure 50: Mexican Foreign Direct Investment (US$ Billion), 2002–2011 ............................................................................................................ 82 Figure 51: Mexican Net foreign direct investment as % of GDP, 2002–2011...................................................................................................... 83 Figure 52: Mexican International reserves, including gold (US$ Billion), 2002–2011 .......................................................................................... 84 Figure 53: Mexican Conventional Thermal Electricity Net Generation (Billion Kilowatt hours), 2002–2011 ......................................................... 85


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Figure 54: Mexican Hydroelectricity Net Generation (Billion Kilowatt hours), 2003–2012 ................................................................................... 86 Figure 55: Mexican Nuclear Electricity Net Generation (Billion Kilowatt hours), 2003–2012 ............................................................................... 87 Figure 56: Mexican Conventional Thermal Electricity Installed Capacity (Million Kilowatts), 2001–2010 ......................................................... 88 Figure 57: Mexican Electricity Exports (Billion Kilowatt hours), 2003–2012 ........................................................................................................ 89 Figure 58: Mexican Electricity Imports (Billion Kilowatt hours), 2003–2012 ........................................................................................................ 90 Figure 59: Mexican Proved Natural Gas Reserves (Trillion Cubic Feet), 2004–2013 ......................................................................................... 91 Figure 60: Mexican Petroleum Consumption (Thousand Barrels Per Day), 2003–2012 ..................................................................................... 92 Figure 61: Mexican Air transport freight (million ton-km), 2002–2011 ................................................................................................................. 93 Figure 62: Mexican Mining, Manufacturing, Utilities Output (US$ Billion), 2003–2012 ........................................................................................ 94 Figure 63: Mexican Patents Granted, 2003–2012 .............................................................................................................................................. 95 Figure 64: Mexican Telephone Lines (In Million), 2003–2012 ............................................................................................................................ 96 Figure 65: Mexican Telephone Lines Penetration Rate (Per 100 People), 2003–2012 ....................................................................................... 97


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LIST OF TABLES

Table 1: Mexican Defense Expenditure (US$ Billion), 2011–2015 ...................................................................................................................... 17 Table 2: Mexican Defense Expenditure (US$ Billion), 2016–2020 ...................................................................................................................... 18 Table 3: Mexican Defense Expenditure (in MXN billion), 2011–2015 .................................................................................................................. 19 Table 4: Mexican Defense Expenditure (in MXN billion), 2016–2020 .................................................................................................................. 20 Table 5: Mexican GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as a Percentage of GDP, 2011–2015..................... 23 Table 6: Mexican GDP Growth vs. Defense Expenditure Growth and Defense Expenditure as a Percentage of GDP, 2016–2020..................... 24 Table 7: Mexican Per Capita Defense Expenditure (US$), 2011–2015 ............................................................................................................... 25 Table 8: Mexican Per Capita Defense Expenditure (US$), 2016–2020 ............................................................................................................... 26 Table 9: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2011–2015 ................................................................ 27 Table 10: Mexican Defense Budget Split Between Capital and Revenue Expenditure (%), 2016–2020 .............................................................. 28 Table 11: Mexican Capital Budget Allocation (US$ Million), 2011–2015 ............................................................................................................. 29 Table 12: Mexican Capital Budget Allocation (US$ Million), 2016–2020 ............................................................................................................. 30 Table 13: Mexican Capital Budget Allocation (MXN Billion), 2011–2015 ............................................................................................................. 31 Table 14: Mexican Capital Budget Allocation (MXN Billion), 2016–2020 ............................................................................................................. 32 Table 15: Mexican Homeland Security Budget (US$ billion), 2011–2015 ............................................................................................................ 33 Table 16: Mexican Homeland Security Budget (US$ billion), 2016–2020 ............................................................................................................ 34 Table 17: Mexican Homeland Security Budget (MXN Billion), 2011–2015 .......................................................................................................... 35 Table 18: Mexican Homeland Security Budget (MXN Billion), 2016–2020 .......................................................................................................... 36 Table 19: Benchmarking with Key Markets, 2011–2015 vs. 2016–2020 ............................................................................................................. 41 Table20: SDI Terrorism Index ............................................................................................................................................................................. 45 Table 21: Productos Mendoza – Product Focus ................................................................................................................................................. 62 Table 22: Aviabaltika de Mexico Company – Products and Services .................................................................................................................. 63

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