As the world order shifts, Europe raises its defence game

Vice Admiral Peter Hudson has been an Executive Royal Navy Board Member, Head of NATO’s Single Maritime HQ as well as the Senior UK Officer in NATO operational command. He was also Head of EU Forces in the Indian Ocean. He is Burson-Marsteller’s Senior Advisor on defence and security.

In Brussels and other capitals across the European Union, the twin votes of 2016 were the shocks that prompted them to switch gears on defence and security. The British referendum to leave the EU and the election of Donald Trump as US President, they argue, jolted European leaders into action, finally agreeing to do something about their overlapping, underperforming and wasteful defence policies.

As European Commission President Jean-Claude Juncker asked, on June 9: “How long can we pretend that countries so intimately linked as we are in the European Union do not also need to face external threats together?” EU countries must step up their military co-operation as they cannot simply rely on the US to defend them, he told a conference on defence and security in Prague. “Our deference to NATO can no longer be used as a convenient alibi to argue against greater European efforts,” he said. “The protection of Europe can no longer be outsourced.”

Mr Juncker’s speech echoed German Chancellor Angela Merkel’s earlier warning that Europe could no longer “completely depend” on the US and UK. It reflected a growing recognition of a new geopolitical situation where Britain, with the second biggest military in the EU, is leaving the bloc, and where the US President could no longer be counted on to respect NATO’s security guarantee.

Now the EU is doing something. On June 7, the Commission launched the European Defence Fund to help co-finance joint military projects, earmarking money to projects that EU member states want to develop together. The plans foresee €500 million in annual resources for joint military research by 2020, and another €1 billion annually for joint investment and purchases of military equipment, such as drones and helicopters.

Research and resources

The new fund has two parts. The first is a “research window” to finance collaborative projects in defence technologies like meta-materials, air-to-air refuelling planes, cyber-defence systems and robotics, for which the Commission has already proposed €25 million in the 2017 EU budget, rising quickly to €90 million annually.

The second is a “capability window” which would let EU countries share costs for new military hardware, such as drone technology or bulk orders for helicopters. One existing partnership is a joint procurement programme for ammunition for an anti-tank system used by Estonia, Latvia, Lithuania, the Czech Republic and Poland.

The measures should bring a much-needed boost to Europe’s fragmented defence sector. Most European countries spend too little on defence. Mr Juncker acknowledged the problems, pointing out that EU countries spend €27,000 per soldier on equipment and research compared to €108,000 per soldier by the US.

Defence budgets are only now rising again after a 12% drop in the decade to 2015. Measured as a share of GDP, defence expenditure fell to an average of just 1.4% in 2015 or €195 billion, its lowest level on record.

Raising spending

That is way below the 2% target set in 2014 by NATO, which has 22 members in common with the EU. Nor is there much balance within the EU: the UK and France are by far the strongest military powers in the bloc and jointly account for 70% of defence research and development spending.

Mr Trump publicly berated laggards at the NATO summit in Brussels in May, saying only five of the alliance’s 29 members had met their obligations. Even if Mr Trump’s tone was brusque, it follows similar complaints about European defence spending by his predecessor, Barack Obama.

Indeed, many in Washington DC refer to ‘social disarmament’, the sense that since the end of the Cold War, Europe chose to spend resources on social issues like benefits, pensions, low working hours, and subsidised health rather than invest in its own defence and security. As European defence spending fell steadily for 20 years, forces suffered.

The consensus has now changed. NATO head Jens Stoltenberg and his predecessor Anders Fogh Rasmussen have both pushed for higher spending, and even before the 2016 shocks, threats from terrorism and an aggressive Russia had helped tweak budgets across Europe. However, the turnaround is slow, and it will still take years to meet the 2% target.

But raising defence spending alone will not solve Europe’s capability problem. Most of the inefficiencies stem from the reluctance of national governments to relinquish sovereign control over defence policy and integrate their armed forces. Armed forces suffer from needless duplication of essential equipment, a lack of interoperability, technological gaps and inadequate economies of scale for industry and production.

Europe has 178 different weapons systems, compared with 30 in the US. One standard NATO helicopter was developed in 23 different versions to cater for differing national specifications. As a result, many countries depend on third countries, notably the US, for ‘off the shelf’ equipment. There is under-investment in intelligence, surveillance and reconnaissance (ISR) capabilities, drones and satellite communications, as well as cyber and maritime security.

This lack of cooperation is estimated to cost Europe up to €100 billion a year. The Commission says EU-wide competition for defence procurement contracts will ensure better value for money, tackle fragmentation in the market and spur competitiveness in the industry. That would do much to help the €100 billion European defence industry, which employs around 1.4 million peopled directly or indirectly. Dominated by Britain’s BAE Systems, Italy’s Leonardo (formerly Finmeccanica) and the Airbus Group, the industry also includes more than 1,350 small and medium-sized companies.

Institutional fixes

The EU’s emerging plans also tie in with NATO. The Commission and NATO have been careful to complement rather than copy actions, and have worked well together in recent years, notably with their respective anti-piracy operations off the coast of Somalia. This caution is partly due to British concerns about undermining the alliance. But even after the Brexit referendum vote, NATO and the EU have remained close. At the same time, the EU-27 and Britain have been coordinating on military operations and on defence markets.

There is still a way to go before the EU can claim efficient and coordinated defence and security. Europe has a long history of boasting of its emerging foreign and defence ambitions, only to see them fade as national interests re-emerge.

But the direction is clear. The European Defence Fund builds on other recent initiatives like the agreement by EU governments last November to create a new military headquarters for non-combat military missions inside Federica Mogherini’s EU foreign service and to make joint “battlegroups” ready for action in Africa or in the Middle East to prevent conflicts.

The changes are long overdue. Since the end of the Second World War, European leaders have taken the US defence umbrella for granted. The political costs have been a neglect of independent strategic thinking and a failure to invest in Europe’s own security and defence.

Brexit and the election of Donald Trump are incentives for Europe to act. Leaders recognise that they need to bear their fair share of the burden of European security and rely less on the US. They also want to reassert the EU’s credibility after Britain’s vote of no confidence.

The latest moves push Europe towards more intelligent and coherent spending. And a more credible defence policy. Mr Juncker explained the challenge in simple terms in Prague. “It is the most basic and universal of rights to feel safe and secure in your own home,” he said. “Europeans rightly expect their Union to provide that for them. And they want their governments to work together to make it happen.”

Authors: Vice Admiral Peter Hudson, Leo Cendrowicz & Dennis Abbott
Photo: CC/Shuttershock




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