EU to Open Defense Market

You have probably heard how overwhelmingly huge America’s defense spending is: Alone, it spends more than the rest of the nations of the world combined. But this doesn’t tell the whole story.

Put together, the 25 nations of the European Union spend about $232 billion a year on their defense budgets. This is over half what the U.S. spends. Considering that the EU is increasingly acting with one voice, it is this figure we should concern ourselves with.

At this point, Europe isn’t getting the biggest bang for its buck. Analysts estimate that, for as much as it spends on defense, its military capability is only about 10 percent of the U.S.’s because of “high wage and pension bills, obsolete equipment and lack of integration between EU armed forces” (UPI, March 30). Though EU nations spend a combined $39 billion on new military equipment (the U.S. spends $100 billion), they “get a fraction of the return on their investment because of duplication in research and development and national barriers to open competition in the defense sector” (ibid.). The single market that the EU has created has not applied to defense matters, as military procurements have always been a more sensitive issue—a matter of individual national policy. This has meant that EU nations, though spending as much money as they do, are doing so independent of each other—meaning nations are duplicating work and reinventing the wheel.

All this is about to change.

EU defense ministers are now agreeing to terms that would change cross-border competition pertaining to military equipment as early as November. The idea is to open up the $39 billion defense market—integrating defense procurements into the Continent’s single market. This increase in competition would drive down military costs and allow the money the EU spends on military equipment to go farther.

Nick Whitney, chief executive of the European Defense Agency is proposing to kick off the project with a “pilot area” that might cover various “land systems” (e.g. armored vehicles). “All EU states are increasingly ditching heavy, slow and cumbersome tanks for lighter, faster and more mobile armed personnel carriers—such as Bradleys—that can be loaded on to C-130 transport planes for quick deployment in combat zones.” Mr. Whitney said the EU will order up to 10,000 of these vehicles over the next 10 years. This would not be possible with the defense industry being so highly fragmented as of now.

We at theTrumpet.com will continue to watch the military advancements of the EU—a seemingly benign union to most. But what is builidng in Europe will soon shock this world! For more on Europe’s military aims, please see our article Steps Toward Military Superiority.