The global market for naval vessels is expected to grow at an annualized rate of two percent during the next 10 years, with North America holding the largest share of the market as the U.S. Navy recapitalizes its fleet, according to a June study published by Strategic Defence Intelligence. 

The study predicted the compound annual growth rate of 2.16 percent from 2014 to 2024. It said North America will represent the largest market followed by the Asia-Pacific, with the two region’s combined market share sitting at 64 percent.

The study also said corvette ships will dominate the market with a share of 23.4 percent, according to a press release by Strategic Defense Intelligence.

The report said the growth will be driven by territorial disputes in the Asia-Pacific, maritime security and the need to replace aging ships.

As China continues to build its military and assert power, it has ran into several territorial issues with neighboring countries, including Japan, the Philippines and Vietnam.