Main results of the European Union Military Committee on 18 May 2022

Remarks by Executive Vice-President Vestager

Good afternoon and thank you for also attending this press conference. We know that we are keeping you very busy today but for good reasons.

The return of war in Europe has been a shock for all of us. What we thought would never happen again on European ground is now a very sad and cruel reality.

But Russia’s unprovoked military aggression against Ukraine has not only dramatically changed our daily lives. It also has significant implications of how we think about European defence. One thing is that it is a shock, but it should lead us now, we should take action.

For decades, Members States have kept their military spending at lower levels, as long as the security environment allowed for it.

The return of war in Europe forces us to build a stronger European defence. And we are witnessing the announcements of increased defence investments all throughout Europe. It is a good thing.

So today, we present an analysis of the defence investments gaps in Europe.

In the short-term our analysis shows that investments will be needed to replenish the depleted stocks of military equipment that many of our Member States are supplying to Ukraine.

In the medium to long term, investments should also help ensure Europe’s security.

But for this to be effective, we need to know what equipment we have. We need to know what we lack, where we should prioritise investment and how we should coordinate among one another.

That is why, and following the call from our European heads of state and governments meeting in Versailles in March, today’s Communication provides exactly this analysis. It gives a clear picture of the defence investments gaps that we face. It also includes measures to strengthen our defence industrial and technological base.

For instance, in the last 20 years, the European Union has increased its military spending by 20%. During the same period, Russia has increased its spending with about 300% and China almost 600%. Of course, from different levels, that goes without saying. But today, the total Chinese spending is remarkably higher than the European.

The thing is, spending more is not the only answer. We have a problem of deep fragmentation and inefficiency in Europe that we have been trying to correct over the years through different initiatives.

So, if all this new spending from Members States is uncoordinated, we could be defeating our own purpose, what we have been trying to achieve over the last years.

It is clear that more spending will be needed, but spending more is not the only answer. We also need to spend better and we need to spend together. And that is, I think, the only smart way to go about it.

The aim is to ensure that increased defence spending by Member States will result in:

• better value for money;
• efficiencies through economies of scale;
• and a stronger EU defence and technological base.

That’s the fundamental objective of the strategy that we present today. It can be reached by increased coordination and joint procurement. The same logic that we applied to vaccines applies here.

By buying together, Member States can get a better deal. And the Commission together with the European Defence Agency and the EEAS, will support Member States in doing so.

Everything we are proposing here will also help make NATO stronger.

21 of our Member States – soon it could be 23 – are NATO allies. This strategy is not about duplicating NATO. On the contrary, is about using the added value of EU tools to help our Member States step up their contribution to the Alliance.

A stronger European Union means a stronger NATO.

Now, both my colleagues High Representative Borrell and then Commissioner Breton will elaborate more on how exactly to achieve this.

I should make this ultra short because we are putting a lot on your shoulders today, not only this press conference but also with RePowerEU.

Before we turn to the questions, I want to underline that the aim here is to spend better and spend together. This is not for the European Union as such to finance, this are Member States stepping up, but the structures that we can create here can allow or enable Member States to make the European Defence and technological base stronger if we do this together. I think that is the most important take-away from this strategy and from this analysis. I invite everybody to read it. It is really well done and there is a lot of analytical calories for the digestion.

Remarks by High Representative/Vice-President Borrell

This Joint Communication [on the Defence Investment Gaps Analysis and Way Forward] from the European Commission and the High Representative for Foreign Affairs and Security Policy is about the state of the art of the European defence capabilities and the difference between what we have and what we should have. This is the gap. The gap is a breach, it is a difference between our capabilities and the capabilities that we should have in order to face the threats and challenges that Europeans are facing.

When we presented the Strategic Compass, the title was ‘Europe is in danger’. And, at that time, before Russia’s aggression against Ukraine, people smiled. Now, unhappily, the danger is very evident, and the ruthless attack of Russia against Ukraine has made it evident for all European citizens that the war is at our borders. The war is a reality that affects all of us – and mainly the Ukrainians, certainly. But it makes clear that war is not something that we [could] forget about forever, unhappily.

Nothing comparable to what is happening in Ukraine has happened in Europe since the end of World War II. In terms of human costs, thousands of soldiers have been killed. In terms of the number of military assets involved, hundreds of tanks have been destroyed, and with the global consequences of this conflict.

And this applies also to the European Union’s response in terms of political, financial, humanitarian, and military support to Ukraine. But to support Ukraine and to support ourselves, we need to increase our capacity to act and take more responsibility for our security.

The Europeans have been comfortable under the US and NATO umbrella, and we got a certain feeling of comfort. And the message today – this message was also in the Strategic Compass – is that we have to do more. We have to do more, and this Joint Communication on the defence gaps analysis, that we have adopted today is a call to strengthen the European Union Member States’ defence capacities because defence in the European Union remains a competence of the Member States, it is a national competence. And the Member States have to wake up and increase their capacities.

On defence expenditures, [Executive] Vice-President [Margrethe] Vestager has been presenting very interesting and convincing data. If we had been spending since 2008 until now, the same amount as before the euro crisis, we would have spent €160 billion more in defence. These €160 billion, now we see that they are missing. They are missing while others have been increasing very much, as [Executive] Vice-President Vestager said, much more than us. The differences between the US and Europe are evident. We have increased [our defence expenditures] by 20%, the US have increased [it] by 66% – three times more.

An important issue with these expenditures is that it is being done mainly on a national basis. The collaborative investments – I mean the investment that is being done all together – is only 11% when it should be about 35% according to our plans. We spend together less every time. It has been decreasing, despite the calls to unify our capacities and despite the calls to spend together, to spend better, to avoid duplications, to avoid gaps. In spite of that, we have been decreasing the amount of cooperative investments.

This trend has to be reversed. Years of budget cuts and underinvestment have to be recovered. We have to have economies of scale, we have to reduce fragmentation and the critical gaps that we have today in our armed forces. Let’s put an example: the US has only one type of battle tank, we have 12. The logistical costs, the duplications, the lack of interoperability is evident. It is evident in our Air Forces, in our Navies. Everywhere, we have fragmentation and duplication. So, we need to spend more but, most importantly, we need to spend together to spend better. And today, with this Communication – and I am talking as much as Vice-President of the Commission and as Head of the European Defence Agency -, we have gathered, we have put together all our intellectual capacities in order to present an expertise to the Member States and the European Council about what we should do in the short, medium and long term.

The most important and immediate problem is a very practical one. We have to refill our stockpiles, our military material, because we have been providing a lot of support to Ukraine on ammunition, on transport, in force protection and we have to refill our stocks. This can be done easily in the short term, but it will be much better to do it together. We have to buy together, as we did with the vaccines and as we want to do with the gas. And that [is why] we are proposing a Joint Procurement Task Force where the Member States should engage in the short-term procurement needs. And we propose also financial incentives for the Member State to participate on that.

In the medium term, we have to increase our existing capabilities and fill the gaps – in terms of quality and in terms of quantity. We need modern air defences, we need drones, we need air-to-air refuelling capabilities, we need tanks and armoured vehicles, we need coastal defence, we need cyber and space-based capabilities – just to name a few.

We know it. The European Defence Agency has been working in the last years to explain these gaps, to explain how we can and should fill these gaps. But to tell the truth, we have not gotten a lot of success and nobody was listening to us. If I may make a joke. I hope that now, together with the Commission, joining the leadership of the Commission, and the [European] External Action Service, and the European Defence Agency, Member States will be more attentive to our warnings. They will understand what are our problems and what could be the solution.

In the long term, we have to modernise our European armed forces, we have to increase our capabilities. We have to define better what are our needs and to provide answers to these needs through a stronger European defence industry. There is no autonomy without a solid industrial basis. On that, the European Defence Agence has also been working. We have been producing this CARD, the Coordinated Annual Review on Defence. In the coming months the last of these reports will be issued. We have been providing a Capability Defence Development Plan. This is the time for Member States to read these documents and to act. These documents are being added as an Annex to this Communication and I hope that the strong political umbrella that the Commission is providing to this issue will make it much more understandable. It is a wake-up call. We need to act. And in order to act, this document presents these lines of action.

Time to act is now. Because we need to react quickly to the current situation, from the industry side to the operational, the concrete military capacities to put – if needed – boots on the ground. Commissioner [for Internal Market, Thierry] Breton will for sure develop all the issues of industry, which is the most solid base for our military capacities.

And dear Vice-President [Margrethe Vestager] and dear Commissioner [Thierry Breton], allow me to say a word about the External Action on Energy Policy that today I presented. It is a part supporting the RePower efforts in order to work together with our partners in the world and develop altogether the purpose of reducing dependence on hydrocarbons and fight against climate change.

And also, the Strategic Partnership with the Gulf in order to share prosperity, the Green transition, security, development and cooperation with such an important set of countries. Important today for global security, energy, but also security – short -, because they are involved with us in the situation created by the lack of agreement with Iranians in the Gulf, on the nuclear side, on the war in Yemen and so many other issues in which we want to work together with the states of the Gulf.

Remarks by Commissioner Breton

Merci Josep et Margrethe,

Comme vous l’avez exprimé, les dirigeants européens, lors du sommet de Versailles, nous ont mandatés pour renforcer notre ambition commune en matière de défense. La proposition que nous mettons sur la table aujourd’hui en est la réponse.

La crise du COVID nous a fait changer de paradigme. Les conséquences économiques nous ont fait épargné ensemble.  C’est la même chose avec la défense aujourd’hui.

Après avoir structuré la recherche européenne en matière de défense au niveau européen, nous proposons désormais d’avancer autour d’un cadre européen pour l’acquisition conjointe de matériel de défense.

Car la réalité des chiffres est éclairante :

Si les États membres ont annoncé – en réponse à l’agression militaire Russe en Ukraine – une augmentation sans précédent des dépenses de défense (200 milliards annoncés), cela ne compense pas des années passées de sous-investissement massif.

Depuis la création de la zone euro, l’Europe a augmenté ses dépenses de défense de +20%, quand les US l’augmentaient de +66%, la Russie de près de 300%, et la Chine de près de 600%.

Par ailleurs, avant la guerre en Ukraine, seuls 8 États membres étaient à 2 % du PIB pour les dépenses de défense. Or si tous les États membres avaient investi 2% de leur PIB en défense depuis 2006, nous aurions dépensé 1100 milliards d’euros de plus et investi 270 milliards de plus dans les capacités.

Par conséquence, notre base industrielle de défense n’est aujourd’hui plus adaptée, ni dimensionnée – en volume et cadence – au type de menaces de haute intensité auxquelles nous faisons face.

Ce sous-investissement a conduit inéluctablement à des lacunes capacitaires importantes : notamment dans le contexte de la guerre en Ukraine (munition, défense aérienne et balistique, blindés hérités de l’ère soviétique), mais aussi à moyen long terme, dans les domaines de l’aérien, du terrestre, du maritime, du cyber, de l’espace, ou de la mobilité militaire.

Alors que les États membres investissent massivement, le risque est grand que – sans coordination – cela conduise à une plus grande fragmentation de notre base industrielle.

Il est donc urgent d’agir pour investir ensemble (de manière collective/collaborative), mieux (c’est-à-dire dans ce qui compte le plus pour la nouvelle réalité sécuritaire) et en Européens (nous proposons un cadre européen d’investissement).

C’est pourquoi, en réponse au mandat du Conseil Européen, nous proposons aujourd’hui de nouvelles mesures très concrètes :

D’abord, la mise en place immédiate d’une task force sur l’acquisition conjointe en matière de défense, afin de soutenir la coordination pour les équipements urgents liés notamment à la situation en Ukraine. Le but sera d’agréger et de lisser la demande, de regarder la capacité industrielle disponible, et de soutenir/organiser l’acquisition conjointe. C’est l’approche qui nous a réussi avec les Vaccins.

Deuxièmement, nous proposerons d’ici l’été un instrument de soutien – avec 500 millions d’euros sur deux ans du budget de l’Union – pour l’acquisition conjointe urgente des capacités de défense identifiées par la task force.

Cet instrument ciblé et de taille limité permettra d’agir en commun en fournissant un cadre européen aux États Membres, mais surtout de tester les modalités d’intervention dans un nouveau champs d’action pour la Commission : l’acquisition conjointe. C’est un changement de paradigme réel pour l’Europe mais nécessaire dans le contexte actuel.

Troisièmement, nous proposerons d’ici à la fin de l’année un cadre européen pour l’acquisition conjointe en matière de défense au travers d’un Programme Européen d’Investissement de Défense (EDIP) co-financé par le budget de l’Union.

Ce programme permettra de fournir un cadre attractif – avec une exonération de TVA et un co-financement UE – pour les États Membres qui décident d’acquérir en commun leur matériel de défense et de développer des capacités qu’aucun État Membre ne peut aujourd’hui réaliser seul.

Quatrièmement, nous proposons d’une part d’avancer progressivement vers une programmation stratégique conjointe de l’UE en amont et d’autre part de renforcer notre base industrielle européenne en soutenant par exemple l’accès aux matières premières, aux compétences et aux technologies critiques, ainsi que la montée en puissance de l’appareil industriel.

Dans ce cadre, il est aussi important que la BEI puisse adapter sa politique afin d’accompagner cette montée en gamme des capacités industrielle de défense, notamment dans les pays les plus exposés.

Pour conclure : Ne nous y trompons pas, ce que nous proposons est potentiellement très structurant pour l’Europe de la défense.

Il n’y a pas de temps à perdre pour le mettre en œuvre.

Je vous remercie.

Source – EU Commission