Swedish defense industry managers look at NATO’s business dividend
HELSINGFORS — Defense industry executives in Sweden, led by Saab CEO Micael Johansson, are lobbying for reforms to the country’s strict military materials export laws to help local companies reap maximum benefits from the non-aligned Nordic state’s impending NATO membership.
– New legislation that makes it easier for companies to export military material and systems would be of great benefit and drive growth in the industry, says Johansson. “It would also create more predictability in international collaborations and enable companies to be more competitive on the order side to win more business in the European Union and from NATO member states in particular.”
The state industry’s lobbying has gained greater importance in view of the projected doubling of defense spending by European countries until 2026. A large part of this spending will be the acquisition of new capabilities from countries, a product area where Sweden has a competitive presence.
The moderates’ party leader Ulf Kristersson, who became prime minister after Sweden’s parliamentary elections in September 2022, is open to considering changes to existing rules that would simplify arms exports to so-called “friendly states” in Europe and North America.
The moderates campaigned for a stronger national military and defense industrial capacity ahead of the 2022 election.
Sweden’s defense sector, the largest of the Nordic states, has already begun scaling up production capacity to meet expected demands for increased order flow when the country is accepted into NATO.
Membership in the alliance, together with EU-led collective defense initiatives, has the potential to give Sweden’s defense companies greater opportunities to form partnerships and participate in joint arms delivery projects, says Robert Dalsjö, head of research at the Total Defense Research Institute (Totalförsvarets). Research Institute).
Dalsjö said that NATO’s gateway to joining international partnerships could lead to Sweden abandoning its policy of producing front-line combat aircraft itself, with the country choosing to supply next-generation planes to Swedish Air Force in collaboration with European or American partners.
“Abolishing own development of Swedish fighter aircraft is a good idea. Sweden could save many billions of kroner by choosing international production collaborations for combat aircraft. It would require changes to domestic industrial policy considerations, but it would be worth the effort, says Dalsjö, who is also a member of the Royal Academy of Military Sciences.
The counterweight to Sweden’s membership in NATO, against the background of a possible relaxation of arms export laws, would also create heightened competition for defense contracts on the domestic market. Such a development can also be expected to lead to an increased interest among international groups to cooperate with Swedish defense companies to run arms procurement projects in Sweden.
Gerard O’Dwyer is Scandinavian affairs correspondent for Defense News.