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DID has covered the push toward a more unified European defense market before, including some of the key players and initiatives, an example of the resistance being generated in member countries, and the developing British industrial policy response.

The European defense integration front has been a blizzard of activity lately. Contributions include a European Parliament report, another from the well-regarded Center for Strategic and International Studies (CSIS), comments from NATO’s supreme commander that could see the alliance’s immediate concerns extend to Russian pipelines and the Gulf of Guinea, and a report from senior NATO generals regarding Europe’s defense future and spending needs.

NATO’s top military commander is seeking an important new security advisory role for private industry and business leaders, as part of a new security strategy that will focus on the economic vulnerabilities of the 26-country alliance.

NATO Supreme Commander General James Jones of the U.S. Marine Corps suggested that two immediate and priority projects are to secure the pipelines bringing Russian oil and gas to Europe against terrorist attacks and to secure ports and merchant shipping. A further area of NATO interest to secure energy supplies could be the Gulf of Guinea off the West African coast, which borders on Liberia, Ivory Coast, Ghana, Nigeria, Cameroon, Benin, and Gabon. Piracy, theft, political unrest and tensions between Islam and Christianity combined to present what he termed “a serious security problem.” This is becoming an increasingly important area for oil exploration and productin, and Jones noted that oil companies were already spending more than a billion dollars a year on security in the region.

All of which begs the question of whether European states could hope to execute such missions, even if all agreed that they should do so. Which brings us to the subject of defense integration.

The latest Green Paper on defense procurement offers a centralized, heavily regulated future for Europe’s defense industries. It notes the distorting effects of current policies of “juste retour” (ensuring that Member States get their “fair share” of contracts) and the “off-setting” of arms purchasers’ costs through supplementary investment deals in the field of military procurement, and unsurprisingly recommends greater “coordination” (read “rationalization and thinning out”) within the industry. It also notes that the inevitable concentration that results from these policies should be subject to greater monitoring and control by the Commission with regard to competition law. The full text of this report is available via the EU [PDF format].

The Washington-based Center for Strategic and International Studies (CSIS) released a related report on Oct. 12, 2005 titled European Defense Integration: Bridging the Gap between Strategy and Capabilities [PDF format]. The 99-page report stems from CSIS’ European Defense Integration project, launched in the summer of 2004 under the auspices of the CSIS Initiative for a Renewed Transatlantic Partnership. Through interviews, research and close cooperation with a network of senior European defense officials, the project team spent over a year assessing current European capability building efforts and exploring how greater European defense integration might be achieved.

Defense-Aerospace summarizes the report’s objectives thusly:

“In the future, the gap between European security strategy and military capabilities threatens to widen. Europe needs enhanced capabilities, yet in the near term defense spending in most European countries remains flat or in decline, while investment in new capabilities will also be constrained by the fragmented nature of European defense demand, the rules of the European defense trade and industrial capabilities that are focused largely on legacy platforms and job creation rather than transformation.

Furthermore, European leaders have generally lacked the political will to do what is necessary to close this strategy-capabilities gap. This study proposes pragmatic ways in which European countries – working together and in conjunction with NATO, the European Union and the United States – can create the military capabilities needed to protect their interests and support their security strategies in the 21st century.”

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A different transatlantic pair of generals have also waded into the debate, with a similar message in hand. US General Joseph Ralston was NATO’s top commander until 2003, while General Klaus Naumann is Germany’s former chief of defense and head of NATO’s military committee. Their 97-page study was presented to EU and NATO leaders in Brussels, and a copy was obtained by AFP.

AFP characterizes the study as noting that Europe risks being unable to meet mounting security risks like international terrorism unless it reverses a failure to pool its defenses, and stating bluntly that that European leaders have “lacked the political will” to improve military capabilities.

Such failure would harm “the viability of NATO as an alliance, and the ability of European countries to partner in any meaningful way with the US.” Instead, they call on European powers to re-allocate defense spending so that 25% of budgets is spent on research and new weapons, while no more than 40% is spent on personnel. They certainly aren’t the first group to call for R&D spending increases.

Integration of Europe’s defense industries is supposedly noted as a necessary step in order to meet these goals, and give European states a military capability that can safeguard their interests in a dangerous world.

“They are absolutely right,” said British Defence Secretary John Reid, whose country is one of only a few EU member states meeting NATO’s recommended target 2% of gross domestic product on their defense budgets. Indeed, several major NATO countries (including Germany) are hovering close to 1%, while the USA currently spends around 5%.

The issue of Europe’s ongoing relevance in global affairs is certainly a live one, with even centrist commentators in the USA openly questioning Europe’s relevance. The ongoing debate over European defense capabilities and the role of NATO is inevitably part of that transatlantic discussion, and ties into Europe’s demographics and economic realities as well as foreign policy issues.

Generals Joseph Ralston and Klaus Naumann will brief European defense officials during the next two weeks, then present their findings in Washington next month.

Additional Readings & Updates:

• Forecast International (Nov 16/09) – European Defense Squeezed by Economic Difficulties, Indifference. ”...the European military market experienced a 5 percent reduction in combined defense spending during the past year.”

• Jane’s Industry Quarterly Reports (July 29/09) – European Defence Spending Falls by Almost $4 Billion in 2009

• Forecast International (Nov 14/08) – A Frugal Pax Europa. “While the global defense market continues to expand, Europe stands as an exception…. Very little exists to change this situation, as government officials remain reluctant to make the case to their publics…. Compounding Europe’s lackluster defense efforts is the poor cost-versus-performance investment per individual soldier…. more than half of its troops are deemed unsuitable for deployment abroad…. Most ominously for the Euro-defense initiative, defense spending cutbacks are occurring among the European nations with the most substantial military capabilities.”
  
  This static environment is explored in Forecast International’s latest European Military Markets analysis.

• International Herald Tribune (May 22/08) – EU defense spending may clash with military goals. A new CSIS study.

• DID (Nov 20/07) – EDA Gets Budget Boost as Europeans Make Pledges. Of course, pledges are only good if you collect.

• DID (Nov 6/07) – NATO About to Lease Troop Helis for Afghanistan? Due to the absence of member nation helicopters.

• DID (Nov 1/07) – Forecast International: A Gloomy Outlook for Europe

• DID (Dec 22/06) – EDA Releases Europe-US Defense Spending Comparisons for 2005

• DID (Oct 13/06) – EDA Sets Out Long Term “Vision” for Europe’s Defense Base

• DID (June 2/06) – EDA on European Defense Research Spending

• DID (May 31/06) – EDA to Launch New European Procurement Code on July 1, 2006

• DID (April 20/06) – NATO Countries: 2005 Defense Expenditures

• DID (Nov 2/05) – Nick Whitney on the EDA and the USA

• DID (Oct 31/05) – Whoitney & the EDA React to CSIS Report on European Defense Industry.

• DID (Oct 17/05) – EU Defense Ministers Take Initial Steps to Open Up Arms Competition

• DID (July 7/05) – EDA Striving for Common Defense Market, But Success Still Years Away

(This article was originally published on Oct. 14, 2005. It was updated to include the CSIS report, the Hon. John Reid’s statements, and Gen. Jones’ proposals.)