EU 20 years behind in defense investment: European Commission

• 

The European Commission said in a report published on Wednesday that “EU member states have failed to scale up defense investment in the last 20 years."

In March, European leaders tasked the European Commission with identifying gaps in defense investment policy and proposing steps to close them in order to strengthen the European defense industry and its technological base. 

As a result of those efforts, Joint Communication on Defense Investment Gaps Analysis and Way Forward was published. 

The document outlined three major types of investment gaps identified across the EU, including defense expenditure, defense industrial gaps, and capability gaps, as well as potential solutions to these gaps.

The report added that the EU increased its combined defense spending by 19.7% from 1999 to 2021, which appears insufficient when compared to a 65.7% increase in the US, a 292% increase in Russia, and a 592% increase in China.

"Had all Member States spent 2% of their GDP on defense with 20% dedicated to investment, since 2006 until 2020, this would have resulted in an additional approximately $1.154 billion for defense, of which around $281 billion on investment," the report read.

Concerning industrial gaps, the document claimed that the European Defense Technological Industrial Base is overall competitive but has flaws such as a lack of cooperative investment, defense companies structured along national borders, and a heavy reliance on imports of key defense equipment and raw materials. 

Import dependence is particularly concerning, as more than 60% of the EU defense procurement budget was spent on foreign military supplies from abroad between 2007 and 2016, according to the report.

The European Commission identified three priorities within the capability gaps: replenishing stockpiles, replacing Soviet-era weapons, and improving air and defense systems.

To address existing gaps and challenges in the short term, the European Commission proposed that EU member states procure military capabilities jointly through the establishment of a Defense Joint Procurement Task Force in the near future.

The organization will "assist in the coordination of their very short-term procurement needs in response to the new security situation."

A European Defense Capability Consortia will be established later to allow member states to "jointly procure... defense capabilities developed collaboratively within the EU and will benefit from VAT exemption."

It is worth mentioning that the report's findings and recommendations are expected to be discussed further at the EU summit in late May.