This week, the European Commission (EC) presented the first-ever, EU-level European Defence Industrial Strategy (EDIS) while also proposing measures to sharpen and integrate bloc-wide defence industry procurement practices. The EDIS offers a long-term plan designed to promote and achieve defence industrial readiness in the EU, maintaining that a stronger and more responsive European defence industry will benefit member states and EU citizens, while also benefiting key EU partners such as NATO and Ukraine.
The Commission has looked to overhaul and upgrade defence industry practices within the bloc, mindful of what has happened as a result of Russia’s invasion of Ukraine two years ago. Now it has tabled draft proposals for a European Defence Industry Programme (EDIP) complete with auxiliary measures to ensure the timely availability and supply of the latest and most modern defence products.The new proposal spells out how the challenges currently faced by the European Defence Technological and Industrial Base (EDTIB) can be overcome as the full potential of the EDIS is realized over the next decade.
In order to step up EU defence industrial readiness, member states need to invest more and to do so more astutely. They also must work more closely with one another, ensuring that suppliers and manufacturers clearly understand that when it comes to procurement and to commissioning demands for state-of-the-art equipment, Europe’s defence industries operate as a collective and should be treated accordingly.
To help member states achieve this, the EDIS proposes:
* Encouraging member states to express their collective defence demands more efficiently by drawing on existing instruments such as the Capability Development Plan (CDP), the Coordinated Annual Review on Defence (CARD) and the Permanent Structured Cooperation (PESCO). To back this up, there would also be an incentive scheme to persuade member states to work collectively during the procurement phase when upgrading capabilities;
* Ensuring the availability of all defence products via an EDTIB charged with becoming more responsive and flexible to client needs, circumstances and deadlines; supporting member state and European defence industry investments to develop and market the latest defence technologies and capabilities; ensuring that the EDTIB has whatever it needs at all times, so it can sustain and broaden the EU’s Security of Supply;
* Ensuring that national and EU budgets support, as needed, European defence industry adaptation to the new security context;
* Mainstreaming a policy-wide culture of defence readiness, e.g. calling for a review of the European Investment Bank’s lending policy this year;
* Developing closer ties with Ukraine by fostering cooperation between the EU and Ukrainian defence industries;
* Teaming up with NATO and strategic, like-minded international partners, and co-operating more closely with Ukraine.
Indicators measuring member state progress towards realising EDIS goals include:
* Procure at least 40% of defence equipment in a collaborative manner by 2030;
* Ensure that, by 2030, the value of intra-EU defence trade represents at least 35% of the value of the EU defence market;
* Make steady progress towards expending at least 50% of their defence procurement budget within the EU by 2030 and 60% by 2035.
