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Former Estonia army chief boosts Europe’s defense industry

Former Estonia army chief boosts Europe’s defense industry

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The former chief of Estonia’s defense forces, now an MEP, is working on how to help Europe’s defense industry.

France wants its security and defense think tanks to become more influential.

Germany wants to make its armed forces more attractive for women amid recruitment challenges.

Good morning, and welcome to Morning Defense. Tips to [email protected][email protected] and [email protected] or follow us at @joshposaner@LauKaya and @calebmlarson .

ESTONIAN LAWMAKER WANTS EU DEFENSE PLAN: The EU needs a well-funded strategy for its defense industry to ensure that small- and medium-sized firms can access major contracts, according to Riho Terras, an Estonian MEP from the European People’s Party who used to run the Baltic state’s defense forces. Terras is on a mission to reform how the bloc supports EU industry, and to avoid having to look to South Korea and Turkey for affordable weaponry.

He’s working up a non-paper on defense support which he wants the EPP to adopt as policy. The Commission will present a defense investment program early next year.

Missing the minnows: The problem, Terras told Josh, is that big contractors with ties to national governments dominate the major contracts, leaving smaller players in the cold and stymying the kind of innovation necessary to cut costs. “[SMEs] don’t find ways to governments and procurement processes,” he said.

Foreign competition: “Poland buys from South Korea, Estonia buys from Turkey, and we are not able to really have European products for our armed forces,” he continued. “That is something that we need to focus on, otherwise we will lose the competition against, especially, South Korea.” 

Bank blockade: Another problem is that the European Investment Bank won’t fund defense companies. “Commercial banks take that as an example not to invest in start-ups in the field of defense,” the Estonian MEP complained.

Mere ‘firefighting’: The Commission has set up ASAP and EDIRPA as short-term funds worth a combined €800 million to boost ammo production and joint procurement between countries, but these are just “firefighting projects,” according to Terras, to ensure that arms continue to flow to Ukraine. “Europe has not done much to increase its capabilities,” he said. “There has been much talk, but the contracts are not there.”

EU: Foreign ministers meet today to discuss the Middle East, Ukraine, Armenia and Azerbaijan. At 10 a.m., the European Defense Agency publishes a report entitled “Enhancing EU Military Capabilities beyond 2040.”

FRANCE: French Armed Forces Minister Sébastien Lecornu meets with his Armenian counterpart Suren Papikyan in Paris to discuss arms deals. They will announce a contract with a French defense company to allow Armenia to “protect its sky,” Lecornu said.

CYBER: EU military computer emergency response teams will meet for several days at the Spanish defense ministry.

**A message from ASD: Following decades of underinvestment in defence, Europe is now rushing to ramp up defence production capacities in response to Russia’s invasion of Ukraine and the deteriorating European security landscape. To avoid facing a similar situation again, Europe must not only satisfy today’s peak demand, but also ensure industrial preparedness for possible future crises.**

MAKING THINK TANKS GLOBAL: This week, France’s École militaire will launch a new defense academy — an umbrella organization that will gather and coordinate 21 French state-funded think tanks on security and defense. The objective is to have a bigger voice in international strategic debates and be more influential with European and American allies. Stay tuned for more on Thursday. 

Anglo angle: “There’s a diplomacy of think tanks in the Anglo-Saxon world, and when I say diplomacy, I’m being nice, as it’s a real strategy of influence,” Lecornu told lawmakers last week.

MILITARY REFUELING AIRCRAFT UPGRADE: The French arms procurement agency asked Airbus Defence & Space to start work on upgrades for the air force’s Phénix A330 Multi Role Tanker Transport (MRTT). 

Known as “standard 2,” improvements will include enhanced communications capabilities with other aircraft and command centers — mostly by allowing access to the French Syracuse IV military constellation — as well as greater ability to fly in hostile environments. Airbus, which was also recently awarded a 10-year maintenance contract by the procurement agency, will retrofit the existing fleet. The air force currently owns 12 MRTTs and is expected to have 15 by 2030. 

QUICK HITS: Saudi Arabia is looking to order 54 Rafale fighter jets, La Tribune reports. Belgian company John Cockerill is in talks to buy the Volvo-owned Arquus manufacturer of French military vehicles, according to La Lettre.

**Dive into POLITICO’s newest newsletter, taking you inside pivotal discussions at the most influential gatherings in the world. Suzanne Lynch delivers the world’s elite and influential moments directly to you. Stay in the global loop. SUBSCRIBE NOW.**

POLAND’S POST-ELECTION MILITARY: The opposition parties likely to form Poland’s next government have views on the shape of the country’s military. Tomasz Siemoniak, an MP with the Civic Coalition party who served as defense minister from 2011 to 2015, said in an interview with RMF FM radio that Poland should have a professional military of 150,000, plus 30,000 to 40,000 territorial defense forces as well as several thousand reservists. He said that Poland simply doesn’t have the demographic potential to have a 300,000-man military — the goal of the outgoing Law and Justice (PiS) party government.

Cue outrage: “The words of Tomasz Siemoniak mean layoffs in the Polish Armed Forces, the liquidation of units and a reduction in Poland’s security,” tweeted PiS Defense Minister Mariusz Błaszczak. Siemoniak fired back, telling him to “stop lying,” and that the 300,000-man military had been “pure propaganda” with no realistic plans on how to achieve it as the armed forces were struggling to retain personnel.

Hey big spender: Under Law and Justice, Poland became one of NATO’s top spenders; its defense budget for this year is 3.9 percent of GDP, while the country has splashed out billons on jets, tanks, artillery and missiles from the U.S. and South Korea. It’s also one of the biggest suppliers to Ukraine. Siemoniak said the defense budget won’t fall below 3 percent of GDP: “There is no question of being able to reduce our defense efforts. They should be more rational, more efficient, while, as a rule, we have to spend a lot of money over the coming years on our security.”

The opposition has also said that procurement contracts signed by the outgoing government will be honored.

GENDER EQUALITY IN GERMAN MILITARY: Germany’s Parliamentary State Secretary Siemtje Möller wants more women in the Bundeswehr — not via promotional campaigns, but codified in law.

The draft legislation, currently in parliament, would also make conditions for members of Germany’s armed forces more attractive, including increased support for childcare. The new law would also ensure reservists are treated the same as active service members for bonus compensation while on deployment.

FIRING GERMAN TROOPS: A draft amendment to Germany’s Soldiers Act aims to make it easier for soldiers to be released from service if they are deemed enemies of the German constitution. According to the bill, soldiers can be immediately dismissed from service if they “pursue serious anti-constitutional aspirations” or if they “support such efforts in one or for an association of persons.” Currently, dismissal can take several years, and soldiers continue to receive pay during the investigation.

FRANCE WILL RENEW SPECIAL FUND FOR UKRAINE: That’s what Armed Forces Minister Lecornu told lawmakers last week, adding the amount “is currently being fine-tuned.” France has exhausted a first special €200 million fund to finance arms deals between French industry and Ukraine — €100 million has been spent, and the other half is committed, Lecornu said. He would like SMEs to benefit from the fund’s second edition, although he insisted there would be “no prioritization.” The new fund could be created by an amendment to the 2024 budget currently under discussion in the National Assembly.

GERMANY SENDS MORE: Berlin delivered three new Gepard self-propelled anti-aircraft guns to Ukraine, as well as more than 3,000 rounds of 155mm smoke ammunition and 20 RQ-35 Heidrun reconnaissance drones.

F-16 TRAINING: Ukrainian pilots will start training on real fighter jets soon, according to a Ukrainian air force spokesperson.

QUICK HITS: U.S. President Joe Biden has a new message about the war, and there’s an America First twist, our U.S. colleagues report. Read here about Washington’s new Ukraine-Israel supplemental funding request, by Paul McLeary.

RIGA CONFERENCE IN A NUTSHELL: Commissioner Thierry Breton, defense ministers from Latvia and Estonia, and a few NATO top officials, past and present, gathered in Latvia’s capital October 20-21 to talk security and defense.

French lawmaker draws criticism: Natalia Pouzyreff, an Airbus exec-turned-French MP with Emmanuel Macron’s Renaissance Party, told a panel that Britain and the U.S. should be excluded from the EU’s investments toward shoring up the European defense industry. That idea didn’t gain much support in the Baltics, which rely heavily on what the French would call Anglo-Saxon defense support.

When pressed if France wants to stop cooperation with the U.K., she replied: “The French-U.K. cooperation is excellent, thank you,” prompting laughter.

Go east: The French defense industrial boost, especially with the EU’s ASAP scheme, “should involve, of course, Central and Eastern European countries,” Pouzyreff said. “We consider, now in our defense policies, yes there’s a trend moving to the east … We are encouraging, as politicians, our industries to go and visit your industrial base as well.”

Ben Wallace blasts EU big boys: In his first international appearance since stepping down as Britain’s defense secretary, Wallace warned “some pretty big countries in Europe” won’t stick to their defence spending promises. Stuart has more from Riga.

FIRST NAVAL DEPLOYMENT FOR GERMAN FRIGATE: Germany’s Baden-Württemberg frigate, the first and namesake of the new F125 Baden-Württemberg class, is on its first deployment overseas to the Middle East as part of the U.N.’s UNIFIL peacekeeping mission in Lebanon. The frigate is expected to remain in the area until mid-2024.

GREEK SUPPORT FOR US: Greek airbases are playing a key role in supporting U.S. efforts in the eastern Mediterranean, Kathimerini reports. U.S. forces are using the Souda airbase; the newspaper says the Elefsina fighter base will also become a hub for American transport aircraft.

US DOD’S CHINA WOES: According to the Pentagon’s China Military Power Report, Beijing is closing the gap with U.S. efforts in space, and Washington needs to act fast to retain its edge, our U.S. colleagues report.

LECORNU DISSES BRETON: Asked by an MP about Breton’s idea for a European aircraft carrier, the French minister said Breton was echoing requests by smaller European countries which cannot afford to build one alone. He added that Breton’s comments have “no impact” on France’s plans to renovate its own aircraft carrier.

MIDDLE EAST: Israel prepares ground invasion in Gaza; U.S. ramps up air defense in the region.

THANKS TO: Jan Cienski and Zoya Sheftalovich.

**A message from ASD: The European defence industry is currently geared to low, ‘peacetime’ production. In the new security environment however, it must have the capacity to address sudden spikes in demand during crisis or wartime. Increasing defence production capacity takes years and considerable capital investment. The challenge for Europe is therefore twofold: rapidly enhance industrial output to satisfy the current peak of demand, and subsequently ensure an appropriate level of enduring industrial preparedness. To achieve the latter, it is crucial to sustain industrial production and development capabilities even during troughs in manufacturing at a level from which it can be quickly ramped up when needed.**

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