Why Asia-Pacific Is Becoming Israel's Next Defense Export Frontier
12/08/2026
Israel's defense exports hit a record $19.2 billion in 2025, extending a run of consecutive annual growth. What's changed is where that growth is coming from. Europe remains the largest single destination, but Asia-Pacific has closed the gap dramatically, moving from a minority share of exports just a few years ago to roughly a third of the total in 2025 a swing large enough to reshape how exporters should be thinking about regional priority.
Vietnam has emerged as one of the clearest signals of this shift, now ranking among Israel's largest defense trading partners in the region, second only to Russia as a supplier to Hanoi. India remains the single largest APAC customer by volume. Still, the more interesting story for mid-sized exporters is in the tier below it: Vietnam, Thailand, Singapore, and the Philippines, each building a substantial and distinct defense relationship with Israeli industry.
Four Countries, Four Different Playbooks
Treating "Asia-Pacific" as one market is the single most common mistake exporters make in the region. The four fastest-growing relationships look nothing alike:
- Vietnam buys primarily through government-to-government channels, with air defense, radar, and missile systems as the core of the relationship, and direct Tel Aviv–Hanoi flight connectivity now reinforcing the commercial link.
- Thailand has moved toward local production, with Rafael Advanced Defense Systems establishing domestic manufacturing of Spike missiles inside the country rather than exporting finished units.
- Singapore is modernizing its drone fleet around Israeli platforms already in operational use, prioritizing proven systems and rapid fielding over long evaluation cycles.
- The Philippines has built a steady, diversified procurement relationship spanning naval, electronics, and support systems, with Israeli suppliers now representing a meaningful share of the country's total defense-related imports.
Each of these is a different sales motion, a different regulatory environment, and in most cases a different buying authority. A single regional strategy built for one of them will underperform in the other three.
From Arms Sales to Industrial Cooperation
The pattern across all four markets and across the region generally is the same one reshaping Israel's other major export markets: governments are converting simple purchases into technology transfer, licensed production, and joint ventures. Thailand's Spike production line is the clearest example, but it reflects a regional expectation, not a one-off deal. Southeast Asian defense ministries are explicitly pursuing indigenous capability development, and suppliers who arrive with a co-production or technology-transfer offer are increasingly favored over those offering a straightforward purchase order.
Analysts tracking the region have flagged this directly: whether the current export boom proves durable will depend on suppliers' ability to move beyond arms sales into industrial cooperation. That is exactly the shift Tel Aviv Capital's model regional presence plus a broader dual-use and industrial mandate rather than single-transaction brokering is built around.
Why This Region Rewards Local Presence
Asia-Pacific defense procurement runs on relationships built over years, often through military and government channels that are difficult to access remotely. The countries seeing the fastest growth in Israeli defense ties are also the ones where Israeli suppliers or their representatives have invested in sustained, in-region presence, trade delegations, defense exhibitions, and standing relationships with procurement authorities rather than opportunistic, deal-by-deal engagement.
That dynamic favors exporters who treat the region as a long-term market to build, not a series of RFPs to answer.
What Comes Next
If Asia-Pacific's share of Israeli defense exports continues on its current trajectory, it will rival or surpass Europe within a few years. The suppliers positioned to benefit will be the ones who treated that shift as foreseeable rather than sudden, building regional relationships, local production options, and in-market representation before the next wave of procurement decisions, not after.