Europe has to create its own Defense industry just when its imports of military equipment from the United States are at their highest level since the end of the Cold War, according to the Stockholm International Peace Research Institute (SIPRI).
Three and a half decades of thinking that Europe had reached a state of "end of History" a la Francis Fukuyama, where the worst disputes would be commercial, have not only left the Armed Forces of the continent reduced to a minimum but also its Defense industry at rock bottom.
The Russian invasion of Ukraine has highlighted that weakness in basic matters such as the production of artillery guns. But solving that was the easy part. The hard part will be creating, first of all, Defense companies that manufacture hardware, that is, tanks, ships, or airplanes. Then, ensuring that those machines are innovative and capable. This means having industrial groups capable of competing with American giants like Lockheed Martin, RTX, or Northrop Grumman, something that Europe, with the sole exception of the British BAE, does not have.
And then comes the third part, which is the most difficult: creating companies that can produce equipment similar to the new US defense groups, which use Artificial Intelligence (AI), Augmented Reality, and big data for military purposes.
Companies like Govini, Anduril, SpaceX, Microsoft, or Meta (the latter better known for its flagship products: WhatsApp, Instagram, and Facebook). Europe, much more concerned with regulation than innovation, has nothing comparable. For example, the satellite telecommunications network Starlink will have two competitors by the end of next year: the US Project Kuiper and the Chinese SpaceSail. From Europe, nothing is expected in the short, medium, or long term.
The American advantage goes even further. Washington can disconnect at will the highly sophisticated American F-35 fighter-bomber, which has been sold to 13 European countries. Furthermore, the usual procedure in all arms sales is that the manufacturing country has veto power over what the buyer can do with those weapons. In other words, the United States can veto European countries from delivering their defense systems to Ukraine. Despite this, Germany wants the US to remain its main arms supplier until Europe develops its own military industry, unlike France, which advocates minimizing European dependence on defense systems from across the Atlantic.
Besides, there is the eternal problem of all major European strategic projects: national sovereignty. In the United States, there was a wave of massive mergers in the Defense sector after the Cold War ended. In Europe, however, mergers occurred within countries. Although different governments have allowed collaboration on specific projects for decades - the nuclear-capable Jaguar fighter-bomber was born in the late 60s as a Franco-British project - the possibility of two strategic Defense companies from different countries becoming one is, for now, remote.
One of the few European exceptions to the rule is Airbus. But that is a case that, despite its success, also illustrates the slowness of the EU and the weight of the States. Airbus was born in 1970 as a joint effort of the Governments of Germany, France, and Spain (the latter two countries actually participated through public companies). Even after Airbus became an independent company a quarter of a century ago, Germany and France each control 10.8% of the capital and Spain 4.8%. The EU does manage satellite networks like Galileo for geopositioning and in the future IRIS², which will have defense applications. And the French satellite group Eutelsat owns the British OneWeb, competing with Elon Musk's Starlink. But it is very difficult to imagine the opposite happening, that is, the French government allowing a foreign company to buy a French satellite company.
Paradoxically, there are also restrictions from the main European economic and industrial power, Germany, on defense exports. The Eurofighter, for example, has been a failure in terms of exports largely because Germany participates in the project, limiting its sales abroad. Its French competitor, the Rafale, has been sold to eight countries. It is the advantage of being able to deliver the weapons one wants.
With the German company Rheinmetall - the largest German arms manufacturer - rapidly seeking empty industrial plants that it can adapt to produce Defense systems, the creation of this industry in Europe is already a reality. The sense of urgency is not only due to the possible rupture between the US and its European (and Canadian) allies but to a much more urgent factor: Ukraine.
It is likely that Washington will suspend arms deliveries to Kiev once a minimally stable ceasefire is reached on the front between Russia and Ukraine. In that case, Europe will have to fill the void left by the US. But Europe, which has supplied Ukraine with a similar amount of weapons as the US, will have to further increase its arms production.
There are creative options that have yielded very good results. Denmark, for example, has helped Ukraine by financing the creation of weapons factories in the country. But that does not change the fact that Europe has nothing comparable to the Patriot anti-aircraft missiles that the US has provided to Ukraine, let alone the THAAD systems that, operated by US crews, have protected Israel from Iranian attacks and the Houthis from Yemen.
For that reason, despite the significant growth of its Defense sector, Ukraine has gone from buying 0.1% of the weapons for sale in the international market in the period 2014-2019 to 8.8% currently, according to SIPRI data. Although it aims for the highest possible self-sufficiency, manufacturing weapons, in the current circumstances, is an impossible goal.