During the corona crisis, EU countries can be used to buy. The European Commission is insisting on this in a published proposal.
Ongoing arms supplies to Ukraine are causing European armed forces to rapidly run out of arms and ammunition. The Commission wants to encourage to work together to replenish those stocks and put on the table for an incentive of 500 million euros. In the long run, it wants to encourage consortia for the development and purchase of defense systems. Cooperation could be through VAT remission.
Twelve types of tanks
In recent decades, Europe spent relatively little on defense and did so in a very fragmented way. Each country wanted to develop its own weapon systems and its own defense industry. In the meantime, Europe with 198 billion euros (2020) as a superpower. But it gets less equipment for that, because the market is fragmented and no benefits can be gained. The tanks are a classic example. Where the US has one type of tank, Europe has twelve.
The war in Ukraine is leading to both a rapid increase in the defense budget and a high demand for weapons and ammunition. Of the 36 billion euros that the EU countries will spend on new items in 2020, only 4 billion will be shared. In recent years, EU-Foreign Affairs Josep Borrell said on Wednesday, there has been even less joint acquisition.
It is unclear how hard armed forces will get through and which country is struggling with transport. 2 billion euros worth of arms have been supplied through the EU alone, from existing stocks.
NATO is concerned about the rapid consumption of ammunition and weapons. Europe’s defense industry is unable to meet demand, according to a senior NATO source. Headquarters considered aloud the establishment of a “war economy” in which the government prioritizes scarce raw materials and parts (such as chips) to the defense industry.
NATO is concerned about the rapid consumption of ammunition and weapons
The Commission will not go that far, but it does request that the warfare directive should lead to an increase in production by European industry. Not only do stocks have to be replenished, but weapon systems that date back to Soviet times also have to be replaced. In addition, the Commission assumes that there are some future plans to be made in air suspension and anti-missile systems.
Europe was long behind in defense spending. According to a survey by the Commission, European spending has increased by 20% over the past two decades. US spending rose 66 percent, Russian spending nearly 300 percent, Chinese spending nearly 600 percent.
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Demand for arms and ammunition is fragmented as each country follows its own investment plans and purchases jointly. Because the arms industry is national, there is also a lack of supply. The EU is highly dependent on foreign countries for raw materials and parts.
Under the European treaties, the Union is not allowed to finance military operations. To avoid this, men limit themselves to the cost of purchase. The arms supplies to Ukraine are paid from a special fund that is outside the regular multi-year budget.
A version of this article also in the newspaper of May 19, 2022