Europese Commissie wenst meer concurrentie in defensie-sector (en)

EUOBSERVER / BRUSSELS - Brussels is planning measures to boost the European defence industry - a strongly sensitive sector in many member states.

Speaking at a conference on collective security in Brussels on Thursday (3 February), Industry Commissioner Günter Verheugen i said that the European Commission would take concrete steps to make the EU defence industry more competitive, arguing that it has been "traditionally excluded from many benefits of European policies".

The Commission also wants to see more competition in the defence sector, drawing ideas about how to open up highly protected and fragmented national markets across Europe from a public consultation launched last autumn.

The plan is to introduce a set of measures in the first half of 2005, Commission spokesman Gregor Kreuzhuber told the EUobserver, adding that while the details are still being worked out, "their ultimate goal would be to remove some obstacles for trade and production within the EU military sector".

"The European defence market is important and interesting, but it is not fully exploited. And while it is still a very sensitive national issue for many countries, member states are fully aware that more integration is a win-win case for everybody", said the spokesman.

However, the Commission is heading into uncharted waters.

"The defence markets have been closed for 40 years and we have to be very careful about their gradual liberalization", said Oliver Drewes, Commission spokesman for internal market.

The EU Treaty makes several exceptions for applicability of European laws in the defence industry and this is not going to be changed even in the new EU Constitution.

Member states argue that it is a matter of their national sovereignty, as well as foreign and security policies.

Hard to come any closer to the US rival

According to Mr Kreuzhuber, whether in the defence industry or in other areas, the EU should no longer look exclusively across the Atlantic for its rivals.

"The US is naturally a very strong competitor, but there are other interesting markets emerging in India, Japan or China", said the spokesman.

However, Tomas Valasek from the Brussels bureau of the Center for Defense Information argues that the American defence market is tough to ignore. And for the Europeans, it is hard to come any closer.

"No other country is spending on defence as much as the US, with 420 billion US dollars for 2005. At the same time, several American companies have merged over the years, so fewer of them produce in large amounts. The same needs to be done in Europe, if it wants to be more effective and competitive".

But, that could be a "bloody and painful process", added the expert, pointing to strong opposition from countries like France or Poland.

"While in the US, it's always simply American companies that prosper or go bankrupt, in Europe it could be, say, a German company destroying an Italian one. And the political pride and jealousy are still too strong, so it's not going to be easy".