What will change for Leonardo, Fincantieri and not only with the EU defense plan?
The EU rearmament plan will favor the development of European industries in the sector. The article by Tino Oldani for Italy Today
The Russian invasion of Ukraine is proving to be a multi-pronged boomerang for Vladimir Putin: not only has it pushed NATO and the European Union to greater unity, it has not only convinced two other countries, Finland and Sweden, to ask for more unity. accession to NATO, but the construction of a common European defense is also accelerating. In fact, Brussels has just launched an EU rearmament plan which, in addition to filling the emptied arsenals by sending weapons to Kiev, intends to buy new ones, as long as they are produced by European industries, a little less by US ones.
Josep Borrell, responsible for foreign policy and security of the EU Commission, said it clearly: «Today the EU countries acquire 60% of their military capabilities externally. It's too much. We must reduce this dependence as soon as possible ». Objective reaffirmed by Thierry Breton, EU commissioner for the internal market: "We must ensure that investments in rearmament, financed with European taxpayers' money, must first of all benefit European industry".
Breton is French and speaks pro domo his own: for years Emmanuel Macron has been a supporter of a common European army and of Europe's "strategic autonomy" in defense, as opposed to the US-led NATO. Furthermore, after Brexit, the major European arms industries are based in France. And the hundreds of billions that the EU Commission is putting on the plate for rearmament are too greedy a mouthful for the French to miss. However, Italy is also interested in this game, which has in the Leonardo group (formerly Finmeccanica), controlled by the state, one of the European champions in the sector.
According to data from the Sipri study center in Stockholm (2017), the largest industrial groups in Europe in the defense sector belong to three countries: Great Britain, France and Italy. The first is British Bae Systems (23 billion euros worth of weapons sold per year; 82,500 employees). The Thales groups (7 billion in sales; 62 thousand employees) and Safran (4.5 billion in sales; 70 thousand employees) operate in France.
In Italy there is Leonardo (8 billion in sales; 47 thousand employed). In addition, SIPRI indicates the European multinational group Airbus, based in France, in second place in Europe by turnover (13 billion in sales; 136 thousand employees) after Bae Systems.
In addition to large groups, according to SIPRI, around 1,350 small and medium-sized enterprises operate in the European defense industry sector, with overall direct and indirect employment of one million 200 thousand units. The countries concerned, in addition to the three largest mentioned above, are Germany, the Czech Republic, Austria, Poland and Spain, engaged in the production of ammunition and armaments, which are mostly purchased by their respective national governments.
All this favors the numerous duplications of armament systems in Europe, which cause excessive and unnecessary expenditure for efficiency purposes. A fact above all: while the United States has only one type of battle tank, the European Union has 12, whose spare parts are often not even interchangeable.
To remedy this productive fragmentation, the EU rearmament plan envisages introducing a task force that will have to supervise industrial procurement, with the dual objective of concentrating them on common armaments and, at the same time, preventing new orders from producing a race to rise in prices.
A regulatory severity dictated by common sense, but also by other factors: the resources put on the plate by the EU, for now, are few, just 500 million euros in two years, completely inadequate to talk about European rearmament (a Rafale jet French costs 115 million). However, these 500 million are a beginning and, an important detail, are drawn from the EU budget. And since the treaties prohibit EU spending on purchasing weapons, in order not to violate them, the EU Commission had to specify that these are funds intended for industry and research, not for the direct purchase of weapons.
In order to have more resources, they say in Brussels, it will be necessary to find them outside the EU budget, setting up a Recovery for rearmament similar to the EU Next Generation, that is to say a fund fed with a new common debt, a hypothesis so far rejected by Germany. Pending developments, it must be said that Germany is also in the front row to strengthen its military industry. It has already decided to spend one hundred billion euros more, in addition to the routine 52 billion a year. And it confirmed the commitment in the German-led French-German Knds consortium to produce the new European tank Mgcs (Main ground combat system), intended to replace the French Leclerc and the German Leopard 2 by 2035.
As part of this project, the German Rheinmetall , which is part of the Knds consortium, did not hide its interest in the purchase of two jewel companies of the Leonardo group, Oto Melara (land weapons) and Wass (naval torpedoes) , a deal that for months seemed close to closing, only to stop after the invasion of Ukraine, in the face of a Fincantieri offer.
The latter affair confirms the excellence of Italian technology, already recognized by the EU when, in March, it distributed 600 million for industrial research and development in the arms sector. At that time, for satellite defense systems and drones, Leonardo obtained more funding than Germany and Spain, and was only surpassed by France.
An excellent visiting card for Italy by Mario Draghi, who at the Versailles summit in March was, with Macron, the promoter of the new EU defense plan. A plan which, also thanks to the increase in national military spending, will strengthen a strategic sector of Italian industry.
Article published on italiaoggi.it
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/che-cosa-cambiera-per-leonardo-fincantieri-e-non-solo-con-il-piano-della-difesa-ue/ on Sun, 22 May 2022 05:44:09 +0000.