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European Commission proposes to switch EU defence industry to "war economy mode"

Tuesday, 5 March 2024, 05:06
European Commission proposes to switch EU defence industry to war economy mode
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The European Commission will on Tuesday, 5 March propose ways for the European Union to stimulate its defence industry so that it can switch to a "war economy mode" in response to Russia's invasion of Ukraine.

Source: Reuters

Details: EU officials said that Thierry Breton, European Commissioner for Internal Market, would present proposals to encourage EU countries to buy more weapons from European companies, as well as to help such companies increase production capacity.


Breton, who was the CEO of a French technology company, also said that the possibility of another term for Donald Trump in the US, who has questioned Washington's commitment to NATO, meant that Europe must do more to defend itself.

Quote from Breton: "We need to change the paradigm and move into war economy mode. This also means that the European defence industry must take more risks, with our support.

In the current geopolitical context, Europe must take greater responsibility for its own security, regardless of the outcome of our allies’ elections every four years." 

More details: Russia's war in Ukraine prompted many European countries to increase defence spending. But EU officials argue that purely national efforts are less effective and want EU bodies to play a more significant role in defence industry policy.

Analysts said the war had shown that European industry was ill-prepared for some serious challenges, such as the sudden increase in demand for large quantities of artillery shells.

Breton's proposals include the creation of a European version of the US Foreign Military Sales mechanism, under which the United States helps other governments buy weapons from US companies.

Another proposal would allow the EU to force European arms companies to give priority to European orders in times of crisis.

To be implemented, these proposals would need to be approved by the EU's 27 national governments, which are often reluctant to cede powers in defence and military affairs, and the European Parliament. The proposals would also be closely scrutinised by NATO, which has said it welcomed EU efforts to promote European defence but has warned that they should not duplicate or conflict with the work of NATO.

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