Breakingviews - Why a defence boss could boost Europe’s revival

BERLIN, April 22 (Reuters Breakingviews) - How to spend 640 billion euros? That’s the amount that European governments, including Britain, would pour each year into their militaries if they make good on their stated intention to beef up defence spending, opens new tab to 3% of GDP. Finding the money is the immediate challenge, given weak growth and heavy debt loads in many countries. A longer-term task is making sure that all the extra investment follows a coherent strategy. It calls for a new figurehead who can coordinate cross-border military projects and keep governments on track. In other words, Europe needs a defence czar.

After years of under-investment, the region’s defence industry is fragmented along national lines and subscale relative to the United States. Europe would struggle to fight a major war with Russia in the short term. EU members only spend, opens new tab 4.5% of their collective military budgets on research and development – a third less, percentage wise, than the United States. Imports account for 75% of European military procurement. The three Europe-made fighter jets – the Eurofighter, Dassault Rafale and Saab’s Gripen – only make up a third of the region’s fleet. And RTX (RTX.N), opens new tab, the $170 billion U.S. contractor, has a market capitalisation that is almost equal to the combined value of its three largest European rivals: Germany’s Rheinmetall (RHMG.DE), opens new tab, Britain’s BAE Systems (BAES.L), opens new tab and France’s Thales.

European governments have now recognised the need to ...
[Short citation of 8% of the original article]