Spirit of ambition: The Ukraine war and European defence integration

These should be good days for European defence. The continent has surprised itself with the unity and determination it has summoned in responding to the Russian invasion of Ukraine. And it has worked together in doing so: cooperating on sanctions; experimenting with Brussels-assisted joint purchases of urgent ammunition; and compensating EU member states for billions of euros’ worth of arms transfers to Ukraine via a jointly subscribed off-budget fund, the European Peace Facility. National defence budgets have soared, and the European Commission has made further cash available from the EU budget to bolster the European defence industry.

How disobliging, then, of the Washington-based Center for Strategic and International Studies to begin its new report, Transforming European Defense, with the words “European defense is in a decrepit state”. Its worry is the persistent fragmentation of European efforts to generate forces and weapons. And its prescription – “deeper European defence cooperation, coordination, and integration” – is only what Europeans have been promising each other for more than two decades. As reporting by the European Defence Agency (EDA) makes clear, European procurement collaboration remains anaemic at best, even as national defence budgets have increased.

Counterintuitively, the Ukraine crisis has made things worse, in two linked ways.

Firstly, the necessary and welcome reassertion of US leadership has reminded America’s European allies of the pleasures of subordination. Among them is the freedom to indulge in internal squabbles – as demonstrated in the levels of mutual dissatisfaction on display between eastern and western Europeans not seen since the bad old days of the “Old Europe” and “New Europe” divisions over the Iraq war. Meanwhile, the relationship between Paris and Berlin is the most fractious it has been for decades (and not just over defence).

Secondly, though European defence budgets have mostly soared, unprecedented sums are now slated to flow overseas, benefiting not just American arms suppliers but Israeli and South Korean firms as well. This would be understandable if it were restricted to the replacement of ammunition and weapons systems so liberally donated to Ukraine. But such immediate needs hardly explain the fact that over one-third of EU members are now set on buying the American F35 fighter. And, to take just one example among many, the Polish plan to spend $15 billion on a national air defence system from the United States will do nothing for Europeans’ supposedly shared aim of preserving and developing the continent’s defence technological and industrial base.

What is to be done? Operationally – ie. in terms of force generation and deployment – the only game in town these days is NATO. Europeans who believe in assuming greater responsibility for their own defence will focus on strengthening the European pillar within NATO. Last summer, the alliance agreed a New Force Model, which set higher readiness levels and increased to 300,000 the number of troops earmarked to deploy to NATO’s eastern borders in a crisis. NATO members are gradually working this up. But, for eastern Europeans, promised reinforcements are no substitute for allied boots on their own ground. So the number of battlegroups – small tripwire forces – actually deployed in the east was doubled, from four to eight. Perversely, however, western Europeans left it to the Americans to provide the bulk of this “enhanced forward presence”. No wonder that, from Tallinn to Bucharest, eastern Europeans clearly trust America more than “Old Europe” – and evince the belief that it is the US that really matters by the choices they make in contracts for US arms suppliers.

So kudos now to Germany for planning to increase its battalion in Lithuania to a full brigade. Other western Europeans should follow suit, or do better.

For the European Union, the main focus will remain on the long-standing task of attempting to build a European defence technological and industrial base that functions on a continental scale. Contrast the automotive sector (which does, and which is a global success story) with the defence industry (which does not, and which is losing market share). The challenge is to try to bring the benefits of the EU single market to the defence sector, when national security get-outs in the EU treaties allow member states to protect their domestic suppliers.

Brussels institutions such as the European Commission and the EDA are doing their best, but they lack the requisite authority and financial firepower. Money and decision-making in defence rest with the member states – and unless and until a critical mass of national capitals are prepared to prioritise efficiency of defence spending over the political expedients of spending defence budgets at home, the outlook is not encouraging.

How large a ‘critical mass’ is needed? Long experience of European collaborative efforts suggests that any grouping larger than perhaps four or five states becomes unwieldly, and gridlocked by competing national priorities (though other participants can often be brought in once a cooperative project has been launched, with its key parameters set). The same model applied, of course, to the birth of the shared euro currency – and the drafters of the Lisbon treaties envisaged doing the same for defence when they introduced the device of permanent structured cooperation (PESCO), providing for a pioneer group of member states with more advanced military capabilities to band together, agreeing shared military requirements and shared industrial solutions to meet them.

Sadly, in implementing PESCO the notion of criteria for membership was, in effect, discarded – such that now every EU member state except Malta has joined the “pioneers”. Little wonder that, as the CSIS observes, “a culture of non-compliance has permeated the PESCO framework”. (The new, German-led Sky Shield initiative to develop a shared air- and missile-defence system seems unlikely to fare better, given that there are now 19 cooks in that particular kitchen, and that the German specification of American, Israeli, and German main components has caused the French and Italians to stand aside.)

Happily, an alternative to PESCO is at hand – or at any rate on the shelf. The moribund Letter of Intent (LoI) agreement between France, Germany, Italy, Spain, Sweden, and the United Kingdom, dating from 2000, is there to be revived. It aimed “to create the political and legal framework necessary to facilitate industrial restructuring in order to promote a more competitive and robust European Defence Technological and Industrial Base (EDTIB) in the global defence market.” The approach was comprehensive, seeking to harmonise national weapons requirements and translate them into collaborative projects, around which the national industries could consolidate.

For now, the UK can be counted out (though the LoI could be a helpful vehicle for rapprochement with continental defence partners under a different British government). But the other five – the EU’s main defence technological and industrial powers – should give thought to reinvigorating their grouping. There is no shortage of projects they might choose to address together. As just one example, emerging lessons from the Ukraine crisis call for a fundamental re-engineering of how ‘deep strike’ effects are delivered (the need is to achieve the quickest and most effective engagement of enemy targets behind the front line, whether by missiles, tube artillery, drones, or aircraft, enabled by the rapid processing of data from all available surveillance and target acquisition assets). A design and procurement effort led by the LoI five would, among other things, be a powerful European contribution to NATO’s revamp (especially if assets are forward-based in the east).

Another possibility would be for the group to trial a limited mutual opening of defence markets to each other, on a voluntary basis – something tried by the EDA with some success, before the 2008 financial crisis led to a ‘renationalisation’ of European defence efforts.

The first step, however, would simply be to make time for a shared reflection on where they now find themselves, preferably at heads of government level but with input also from defence industry bosses. Do they still believe in the necessity of trying to achieve a truly integrated European defence technological and industrial base – and are they ready for the effort to move together towards that goal? Or would they prefer just to carry on sitting by while the US and China extend their lead in the technological race for the future, and non-European defence contractors continue to steal their lunch?