Sunday, 26 November 2017

Where next for UK defence?

Though I am a little late to the party I think it worth making mention of the PESCO agreement which some are describing as an EU army amidst a number of high profile denials.

This agreement takes formal defence co-operation in the European Union to a new level. Under PESCO, each country has to provide a plan for national contributions. The participants will be backed by a European Defence Fund that should be worth €5bn annually after 2020. The money will be used for weapons research and equipment purchases. 

Categorically this is not a "Euro army" but it is most certainly what the EU would call a tidying up exercise to formalise that which already exists, further moving the UK toward the fringes of European defence cooperation. Since the UK buys Apache, RC135, P8 Poseidon, F35, Chinook and a number of other high profile US toys, the UK has already chosen its defence partner, and that is not the EU. 

Whether or not the UK is involved in any future European programme to develop the next generation fighter remains to be seen. BAE Systems believes that it will in some way be involved. European politics being what it is, we can expect moves to isolate the UK and ensure any jobs from such a venture will stay on the continent. 

As to any operational cooperation, NATO will remain the common framework while the EU steams ahead with ever closer union. It is not a euro army but it is another subtle move in that direction. As is consistent with the EU modus operandi. 

In that regard I expect that if we see another action similar to that of Libya, the EU will be looking to keep command of such a venture in house, keeping NATO in the loop as a scapegoat for when it goes wrong. The framework itself will allow for member states to take the lead and for reluctant states to give the outward appearance of non-intervention while supplying material and logistical support under an EU flag. 

As with everything else the EU does, it will never formalise as a single command under an EU executive but it will go ninety percent of the way and fudge the rest. The EU likes to have plausible deniability. 

We can also say that member states will push back against full integration, not least France which will continue to exert its influence over its colonial interests. France will maintain independent defence cooperation with the UK as a means to avail itself of assets from Waddington and Brize Norton. The UK will naively oblige even though no such reciprocal support would come were we to mount a similar operation of our own. That is the French understanding of cooperation. 

As regards to PESCO, for the EU to have mobilised something so quickly after the UK's decision to leave the EU, it would suggest this has been in the works for some years already with the UK dragging its heels. For the EU to make big noises now is more a deliberate diplomatic signal. It wants the UK thinking about EU defence cooperation and whether we want to be on this particular bus. No doubt the EU does want some UK participation and it would be in our interests to maintain a high level of involvement. 

The short of it is that the UK cannot afford to operate a wholly independent military and that reality has influenced our defence spending for at least a decade. In taking on aircraft carrier capability it was always the case that we would have to specialise and look to foreign partners to play their role in Western defence. Consequently our amphibious capability is under the microscope and we can expect to see HMS Albion sold off. 

In this we have the option of European cooperation under the NATO banner or indeed further cooperation in CANZUK countries, which in a defence context makes a great deal of sense. As the UK specialises in carrier operations Australia makes up the shortfall in amphibious capabilities with two Canberra class Helicopter Landing Docks (pictured). We should also note that even though the UK is committed to a new fleet of frigates, in the wake of Brexit it is a near certainty that the number will be cut. It is therefore a necessity that we look to allies to mount a fully effective carrier battle group.  

The UK is far from alone in struggling to maintain operational capabilities and as we head into a new era of economic uncertainty (when are we not?) governments will want to spend more on domestic concerns. Defence cooperation, therefore, is just good sense. Duplication of NATO capability is a waste. 

Brexit most likely means the UK will be second in the pecking order for EU defence projects but then again this is largely a formalisation a the status quo. UK defence procurement will always look to preserve jobs in Yeovil before it looks to collaborative efforts - and our continued support of US military adventures means we will continue to gear our forces for US interoperability. 

In this respect we are seeing a continuance of old habits. Britain is psychologically separatist when it comes to defence. Our national ego, rooted deeply in our Eton educated establishment views European defence cooperation as inferior - with an ongoing (and not unjustified) suspicion that the French are not acting in good faith. Since we have gradually dismantled our aerospace sector, our preference will always lean toward US air power - usually for no better reason than they have sex appeal and the generals like mean looking toys. 

But this is ultimately why the UK doesn't really get the EU. Our defence establishment thinks in terms of NATO and the anglosphere - a large reason being historical alliances and our righteous victories. That mindset is to this day deeply entrenched and there is just enough pushback for the UK to never be a wholly committed European partner. It is too much of a bruise to the national ego to assume the role of a subordinate "partner" in Europe - especially when France is the military superpower inside the bloc. 

This is a view with which I have some sympathy. France is not a reliable or honourable defence partner. Cooperation with France in good faith usually results in the cannibalisation of UK defence assets and we watch the jobs move to France. French defence corporations are still very much French whereas BAE Systems is a global multinational with no particular corporate loyalties to the UK. 

In any estimation, the UK defence establishment has been in a state of decline for the last three decades and we are poised, eventually, to slide from the top ten arms exporters. We should note, however, that our strengths lie not in ships and aeroplanes (and all the toys which appeal to our national ego), rather the UK is a supplier of black electronic boxes upon which modern military depends. In respect of that, it is vital that the UK safeguards its position as a research and innovation powerhouse. 

The short of it is that the EU is now putting up walls to the UK - and though superficially that is a worrying development, it should also shake the UK out of its complacency and should also wake us from our naive belief that EU cooperation strengthens the UK defence sector. Little by little it is cannibalised by European actors for the greater glory of the EU. 

In a lot of ways defence cooperation and defence procurement is a bellwether for international relations. The UK psychologically and strategically has preferred to keep its options open, and given European history this remains the best policy for the UK. In this the EU is the inward looking isolationist and PESCO is almost certainly a step toward weakening NATO. It speaks to the EU's self-image as a rival to the USA as a military power.

Speaking more broadly we are presently watching a realignment in global power. The dominance of Boeing and Airbus is coming to an end. The structural inefficiencies have remained unchallenged for decades but with new markets opening up for smaller mid-range aircraft such as the Bombardier C Series and Embraer E-Jet family, and with China making impressive inroads into the sector, there is soon to be a genuinely competitive global aerospace market where Airbus will no longer enjoy regional monopolies. It can afford no more costly white elephants.  

The hegemony of both the US and Europe is coming to an end. We face a number of challenges to enhance our global competitiveness and in that, Brexit is one of the many triggers that indicates the end of the old world order. As daunting though this may be, it breaks the deadlock for the EU while forcing the UK to gets its skates on. Whether or not we can rise to this challenge remains to be seen. 

What we can say is that the UK has a number of difficult choices ahead and will have to abandon a lot of long standing assumptions. In seeking out a new role in the world it will open up a number of new avenues for cooperation. In this respect many Brexiteers are right. Though there is no scope for regulatory union and economic integration as per the single market, CANZUK does present itself as the UK's natural home for future defence cooperation. 

For the UK it was never a realistic proposition that we place all of our economic and defence interests into a single basket. One can see how it would make sense for mainland countries, with France at the centre, but the UK's future depends on its agility and flexibility. 

This does not rule out the possibility of operational cooperation with the EU and so long as we have assets like the QE carriers and Trident, we will continue to be an important part of the defence of the West. To that end the UK must work to ensure NATO remains the dominant framework. 

As ever, it must be said that the UK's post-Brexit fortunes are largely contingent on how Brexit is handled. Some have suggested that if Airbus is forced to depart from the UK it may look to move its design arm out of Europe entirely. The far east is certainly not short on engineering talent. While a hard Brexit has major economic ramifications for the UK, the effects on wider European trade are also substantial. The harder those effects the greater impact they are likely to have on European defence spending which could well torpedo EU ambitions in that domain.

The diplomatic signals with regard to PESCO from the EU are very much a sideswipe at the UK. This is to be expected. This has long been a faultline between the UK and the EU and the EU is keen to demonstrate that it is not a wounded animal. We should not, however, forget that a mishandled Brexit is a lose-lose for Europe and European defence and we should keep in mind that the EU, politics notwithstanding, is a hugely important ally. Either side would be foolish to lose sight of that. 

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