Mon Sep 09 14:43:55 UTC 2024: ## EU Should Buy More From Its Own Arms Industry, Says Draghi

**BRUSSELS** – Former European Central Bank chief Mario Draghi has urged European Union member states to prioritize purchasing weapons from the bloc’s own defense industry in a new report on EU competitiveness. The report, which comes after a period of rapid rearming in the wake of the Russian invasion of Ukraine, highlights the fact that 78% of the €75 billion EU countries spent on defense between June 2022 and June 2023 went to non-EU suppliers, with 63% going to the United States.

While acknowledging that the US possesses certain advanced capabilities not yet available within the EU, Draghi argues that “in many other cases a European equivalent exists, or could be rapidly made available.” Despite the existence of European-made equipment like Eurofighter Typhoon and Dassault Rafale fighter jets, and Leopard 2 A7+ tanks, many countries are opting for foreign suppliers, including the Lockheed Martin F-35 Lightning II stealth fighter.

The report emphasizes the need for “substantive incentive mechanisms,” potentially linked to EU funding, to encourage governments to buy European. This could involve tying funding to eligibility criteria, similar to those already in place for the European Defence Fund (EDF) and the proposed European Defence Industry Programme (EDIP).

Draghi also emphasizes the importance of joint spending and procurement to overcome the fragmented nature of Europe’s defense market. He suggests promoting “industrial defense consolidation” to achieve greater scale, referencing the successful consolidation of the US defense industry, which has shrunk from 51 leading companies to only five since 1990. However, he cautions against potential risks of dependence on a small number of suppliers.

The report advocates for improved access to EU financing for the defense industry, including permitting the European Investment Bank to support purely defense investments, not just dual-use projects.

While the report has been met with cautious optimism, with countries in the Baltic and Nordic regions showing particular interest, the overall implementation of these recommendations remains uncertain. It remains to be seen whether EU member states will prioritize the bloc’s own arms industry over potentially cheaper or more advanced options from foreign suppliers.

Read More