Europe has become convinced that its American ally will no longer guarantee its security, and has decided to rearm massively. How does it plan to do this? Can it afford it? And what impact will this new scenario have on its geostrategic position, but also on its economic and industrial sectors?
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00:00It's dangerous times and Europeans need to be ready.
00:04There is a lack of structured dialogue between industry and European bodies.
00:16Europe is convinced that its so far US ally will no longer guarantee its security
00:21and has decided to rearm massively.
00:24How does it plan to do it? Can it afford it?
00:27And what impact will this new scenario have on its geo-strategic position
00:32but also on its economic and industrial sectors?
00:44The European Union has committed to strengthen its defense capabilities.
00:49The proposal of the European Commission, Rearm Europe,
00:52prioritizes the supply of strategic equipment
00:55such as air defense and anti-missiles, artillery systems, missiles, ammunition,
01:00drones and anti-drone systems.
01:04Military spending would be excluded from the strict European fiscal restrictions.
01:11If each member state allocated 1.5% of its GDP to defense,
01:16the combined budget would rise on average to 650 billion euros.
01:23In addition, the plan provides 150 billion euros in loans
01:27to acquire material mainly manufactured in Europe.
01:33Additional funding sources are being studied,
01:36including the mobilization of private investments.
01:40The EU is also studying the harmonization of joint requirements and purchases
01:45to guarantee a more efficient market, reduce costs,
01:50streamline cross-border access to supply chains
01:54and increase the competitiveness of the entire European defense sector.
02:04A total of 2,500 companies operate in the defense industry of the European Union.
02:10They are prepared for this new scenario.
02:13What follows is the portrait of one of them,
02:16which, like almost all the others, faces the future
02:19with a mixture of great expectations and prudent strategies.
02:31Every year, 60 employees produce here 70 unmanned aerial vehicles
02:36for civil and military applications.
02:39They are currently used in surveillance, communication and intelligence operations
02:44in conflict zones in Ukraine and Iraq.
02:47Its latest model has just received a key certification
02:50that should accelerate its deployment in member countries of NATO,
02:54says the company's executive director.
02:58The certification took five years,
03:01over 40 experts worked on it,
03:04over 28,000 text pages were processed
03:08and hundreds of flights were carried out.
03:12The company is expecting to invest around 40 million euros this year.
03:16It has begun cooperating with the European giant Airbus Defense & Space.
03:20Its executives claim that their models are made entirely in Europe.
03:28Companies like Primoco are very important for the safety of Europe,
03:32because the domestic defense industry can ensure stable supply
03:38and operation of any equipment, whether military or civilian.
03:43So cooperation with European manufacturers
03:46is crucial for the defense capabilities of Europe.
03:50However, this cooperation has often left them frustrated,
03:54as they say excessive bureaucracy and regulation
03:57have limited the signing of contracts that would increase production
04:01and create more jobs.
04:04I really think that the biggest problem is that politics has moved away
04:09from what the innovative industry can really do.
04:14There is a gap or a lack of mutual dialogue.
04:20Maybe there are concerns that the industry is just a public order,
04:26but we need greater and better communication
04:30between the state, research, development and industry,
04:34just as it is in the United States,
04:37so we have to get used to it here in Europe and support it.
04:41The company plans to increase production to 250 units per year
04:45in a larger robotized factory.
04:48They are optimistic about the new European predisposition
04:51to equip themselves with equipment made in Europe.
04:54I am not optimistic yet,
04:57but I believe that the current political situation
05:02is stabilizing the European defense industry
05:07and is starting it.
05:10It would be best if the European Union gave the companies freedom,
05:16that is, did not create more bureaucratic requirements for them,
05:23but gave them space for further development and self-realization.
05:46The European defense sector generates around 600,000 jobs.
05:50The new scenario could contribute to creating even more.
05:54But can a Europe that is already very indebted
05:57allow this enormous effort to rearm itself
06:00in the current unstable economic situation?
06:03This university professor of international security
06:06affirms that given the new geopolitical context,
06:09Europe has no choice but to move forward.
06:13If you look at the Cold War era,
06:16the NATO member states were approximately spending
06:19about 4, 5, even 6% on defense.
06:23So those numbers have already been here.
06:26So it's something which is not imaginable.
06:29Of course, in the current context, it's slightly complicated,
06:32because the national debts are pretty high.
06:35We can see that more than 50% of the European Union members
06:39have some serious fiscal issues.
06:42So the question is, where do you get the money from?
06:45We know that Europe is based on a strong welfare state.
06:48We have to find some balance between security and welfare
06:51we want to maintain.
06:53For instance, you can increase taxes,
06:56which I guess would be highly unpopular in most of the states.
07:00If you don't want to borrow more money or increase taxes,
07:03then the only thing that is left is to cut something
07:07within the national budgets.
07:09Will community members be able to rearm themselves
07:12only with equipment manufactured in Europe?
07:15We know that around 64% of the weapons
07:20we purchase outside of Europe.
07:24So we have to find a way how to deregulate,
07:28how to loosen the rules and the taxonomy rules
07:30for the defense industry to enhance the development
07:33of their manufactories, factories and so forth,
07:38to allow them to produce more
07:40and to allow us to buy more in Europe.
07:42Europe plans to set a minimum threshold
07:45according to which 65% of the military components
07:48eligible to receive funding must be European.