Abstract
We examine how emerging market defence entities have developed and internationalised, the role that industrial policy has played in this regard, and whether and (if so) how they have been able to build their indigenous innovation capabilities. Four in-depth country cases are analysed longitudinally, from the inception of their domestic military industries through the internationalisation of their firms and into the present - namely Singapore, South Korea, Turkey, and the United Arab Emirates. Our research highlights the challenges for emerging market multinational enterprises in the defence industry of moving beyond linking and leveraging in terms of indigenous industrial capabilities. It demonstrates how the policy landscape through industrial policy and government support contributed towards the development of these capabilities but also points to the limitations thereof. It is evident that external support – primarily through industrial participation and technology transfers under offset arrangements – played a critical in the initial stages of defence industrialisation of the four markets, permitting the countries and their companies to gain competencies at a far faster pace than would have been possible through a more organic evolution. We analyse why some companies were able to leverage these opportunities and build unique capabilities from these linkages, whilst others remained dependent and reliant on these offset derived workshares and technology transfers.