War against Ukraine: The EU’s procurement needs

The war in Ukraine brutally reveals how far the EU is from a common security policy. This is particularly clear in armaments projects. Sabrina Fritz about the limits of some projects.

The war in Ukraine is extremely material-intensive. “On the one hand, there is fighting in trenches like in the First World War. On the other hand, drones and AI are in use,” says Burkhard Schmitt, who is responsible for security and defense at the Association of the European Aerospace and Defense Industries (ASD) in Brussels. In addition to the high demand for conventional material, there is also the need for high-tech products.

This high demand is now hitting a defense industry that has been kept in a kind of vegetative state in Europe for decades and now needs to be brought back to life as quickly as possible. There is actually money available, perhaps not enough, but at least a fairly large sum of $380 billion for this year alone, as NATO Secretary General Stoltenberg proudly announced.

Purchases are mainly made outside the EU

So far, the money has mainly been spent abroad. “Almost 80 percent of military spending in the past two years went to American companies and Israel,” said Schmitt: “The higher budgets in recent years largely did not benefit European industry.”

The Poles ordered their battle tanks from South Korea, where they were quickly available. Anyone who needs weapons or tanks today will find it easier to find them in countries that are used to living with a threat – like the USA, Israel or Korea. Peaceful Europe is different. In any case, there is no European defense policy, and it has not yet been considered necessary.

The EU Commission is not allowed to buy weapons at all. Thierry Breton is responsible for defense, but the EU Commissioner is also responsible for digital, the internal market and services. A separate defense commissioner is now being discussed.

Where does the money go?

And then it’s always about money. One example is the so-called Peace Facility, a separate pot launched in 2021 from which third countries are to be supported. The EU has scraped together five billion euros that can be used for security in Europe over the next few years. For example, this is used to compensate countries that supply material to Ukraine.

France wants to combine this with a “Buy Europe clause”, i.e. the obligation to buy military equipment in Europe. When designing the peace facility, Germany is arguing about the size of the share and demands that its own bilateral services for Ukraine be taken into account. All of this takes time and time is a big factor in war. Ukraine has none.

And despite the enormous pressure, the changes take time: “Completing the mentality change takes time, this applies to an authority as well as to the industry. In this respect, there is a contradiction between what you hear and what actually happens,” says Schmitt .

Little time for complicated processes

Procurement offices do not transform into a well-positioned online shop overnight and companies also need time. For new systems, for example, approvals are required, companies have to hire people and buy materials and for this they need one thing above all: reliability, demands the armaments association. “The arms industry only has one customer and that is the public sector. If they don’t order, nothing will be produced.”

Despite the pithy speeches at conferences and ministerial meetings: rearmament is not that easy. Money is tight, what do voters say, how reliable are the Americans? Nobody knows how long the war in Ukraine will last and how much armaments it is best to order now.

National interests remain

And for all the “we” there is also a big “I” in Europe. Every country has its own interests that it puts first. The Eastern Europeans, in whose neighborhood the war against Ukraine is raging and who have a historically strained relationship with Russia, want to fill the depots as quickly as possible. Southern Europeans tend to be further removed from the war.

Each country develops its own armaments projects and supports its own companies. Economics Minister Robert Habeck recently complained at the Munich Security Conference about “protectionism by individual countries for their arms industry.” The high demand also drives up prices.

The problem Ammunition procurement

One of the few major joint projects is the order for one million artillery shells for Ukraine. Last March, the defense ministers set out to make this amount available within a year – but at the end of January the EU had to admit that it had clearly missed the target.

The order is being carried out by, among others, the EDA, the European Defense Agency in Brussels. A little more than half has now been procured, according to the agency’s deputy head, André Denk: “The goal is to reach one million by the end of this year, so we are behind schedule. However, if you look at the schedule realistically, it is also significantly better, than was to be feared.”

For André Denk, the mission is not yet accomplished. You now have to spend more money and keep ordering, he says. “Because if I order ammunition today, it won’t arrive for another year.”