Latest / Espresso Briefings by BusinessEurope / Business side of Europe’s defence

Transcript

Business side of Europe’s defence · Espresso Briefings by BusinessEurope

• 0:03
  SPEAKER_01: Welcome to Espresso Briefings by Business Europe.
• 0:06
  SPEAKER_01: Timely insights and expert perspectives deserved a short, sharp episode to fuel your thinking.
• 0:15
  SPEAKER_01: Welcome back to Espresso Briefings, Business Europe's podcast on the big issues shaping European business.
• 0:21
  SPEAKER_01: Today we're talking about security and defense and why this debate matters far beyond the defense sector.
• 0:28
  SPEAKER_01: This week we are hosting a conference on security, resilience and competitiveness with Andreas Kubilus, European Commissioner for Defense and Space, alongside the representatives of the European institutions, NATO, and of course business.
• 0:40
  SPEAKER_01: Joining me today is Klaus Holsen.
• 0:43
  SPEAKER_01: He is Business Europe's Vice President in charge of security and defense.
• 0:47
  SPEAKER_01: Klaus, welcome.
• 0:48
  SPEAKER_00: Thank you.
• 0:49
  SPEAKER_01: Security and resilience have moved on the top of Europe's agenda.
• 0:52
  SPEAKER_01: Unfortunately, for the reasons none of us would have wished it for.
• 0:56
  SPEAKER_01: When we talk about strengthening Europe's defense, why the wider economy matters so much now?
• 1:02
  SPEAKER_00: I think when we talk about defense, then we also talk about industry.
• 1:12
  SPEAKER_00: We see that from some of the hybrid threats we're having, some of the cybersecurity attacks we're having, the disruption that creates on our supply chains and so on.
• 1:22
  SPEAKER_00: So business very much needs a good preparedness and a good set of defense, and coordinating that across Europe has become even more important than it's ever been.
• 1:32
  SPEAKER_01: And security is becoming an economic issue, in fact.
• 1:36
  SPEAKER_01: Security and competitiveness depend on each other.
• 1:39
  SPEAKER_01: And what does it mean for Europe's economic and industrial agenda for the coming months and years?
• 1:44
  SPEAKER_00: As you say, they depend more and more on each other.
• 1:48
  SPEAKER_00: So for business to step in and be part of defense and delivering some of what is needed for European defense is important as well as to have the European defense.
• 2:00
  SPEAKER_00: So I think that there's a big opportunity for European companies to step up, be part of delivering in defense.
• 2:07
  SPEAKER_00: There's a lot of dual use that can be had in this area.
• 2:11
  SPEAKER_00: So there's a lot of opportunity as well in this space for the businesses in Europe.
• 2:17
  SPEAKER_00: This is not just a political issue, it's also a big business issue, big business opportunity as well.
• 2:23
  SPEAKER_01: And we started our conversation from speaking about the crisis.
• 2:26
  SPEAKER_01: This brings us to the question of preparedness.
• 2:28
  SPEAKER_01: What would it take for Europe to move from just reacting to crises a little bit like now, and rather being ready for the crisis before it hits?
• 2:37
  SPEAKER_00: I think that we've seen good examples of Europe getting together when it really matters.
• 2:42
  SPEAKER_00: So you've seen the Europeans get together when we had COVID and a few other examples where we kind of got together and figured it out as one group, not a country by country.
• 2:53
  SPEAKER_00: And I think this requires the same defense, is not something you just do country by country.
• 2:59
  SPEAKER_00: These threats are multi-country threats.
• 3:02
  SPEAKER_00: So really getting together as one in Europe, having the businesses understand the full European perspective on this.
• 3:11
  SPEAKER_00: We just need to put it into the planning as well and not wait for the crisis to happen before we do it.
• 3:16
  SPEAKER_01: You speak about European angle and European initiatives, but somehow defense still remains quite a national competence.
• 3:24
  SPEAKER_01: Do you think that greater European coordination would make difference?
• 3:27
  SPEAKER_01: Like some what is now in fashion to say, like operational single market for defense, is it a reality?
• 3:35
  SPEAKER_00: The single market for defense is certainly not a reality right now.
• 3:39
  SPEAKER_00: A lot of this is still country by country, and it's countries positioning themselves to be in the right space.
• 3:45
  SPEAKER_00: But I think if we want more companies to engage in this, especially some of the smaller and medium businesses, I think we need some more standardization across Europe.
• 3:55
  SPEAKER_00: So we decide that we need one type of each of these things, and then that should be coordinated with NATO as well.
• 4:03
  SPEAKER_00: We shouldn't have a European standard that differs from the NATO standard, because if we do, then we're not able to support NATO with what their needs are.
• 4:12
  SPEAKER_00: And in many ways, uh that's what we should do as well.
• 4:15
  SPEAKER_01: Let's uh leave NATO for the moment apart.
• 4:17
  SPEAKER_01: We will come back to this question.
• 4:19
  SPEAKER_01: But you mentioned um small companies and small enterprises.
• 4:24
  SPEAKER_01: Do you think this better coordination would give more opportunities to the SMEs and small companies that might not see themselves as part of the traditional defense sector?
• 4:35
  SPEAKER_00: I think it will, and it will because if you're a small and medium company, then delivering to all the countries in Europe, all having a different standard, becomes very complex, which means that you're going to end up only dealing with maybe your national or a few countries around you that might have similar standards to this.
• 4:55
  SPEAKER_00: Whereas if we have something that is more standardized, then the small and medium businesses have a much bigger opportunity to engage and become multinational.
• 5:05
  SPEAKER_00: That's good for the company, but it's also good for Europe to have strong companies in Europe who can be part of delivering their defense.
• 5:16
  SPEAKER_01: And coming back to the preparedness that we discussed before, do you think also public authorities should involve and consult business beforehand and small, big companies more systematically see with them how to be prepared for the crisis?
• 5:32
  SPEAKER_00: Engaging on preparedness is in my mind really important.
• 5:36
  SPEAKER_00: It's also what helps the government have a functioning society should we have a problem.
• 5:42
  SPEAKER_00: Think of a situation where there's a hybrid attack.
• 5:45
  SPEAKER_00: Water is not possible in a mid or major city for two or three days.
• 5:51
  SPEAKER_00: If you don't have an engagement with some companies who have the lorries to drive the water to this city, if you don't have an engagement with the train company, if you don't have an engagement, you know, you need to have some engagement where people are ready to step in and give you access to their infrastructure, give you access to what they're doing.
• 6:11
  SPEAKER_00: I think that's important.
• 6:13
  SPEAKER_01: I guess it would also be reassuring for the citizens to know that business is prepared and is involved, I suppose, because yeah, the examples you brought are not uh not very positive, but let's be realistic and pragmatic, right?
• 6:27
  SPEAKER_00: And the citizens we talk about, some of them work for these companies.
• 6:31
  SPEAKER_00: So they need to be prepared both at home and be prepared at work.
• 6:35
  SPEAKER_00: Uh that's kind of what the real preparedness is all about.
• 6:39
  SPEAKER_01: And the single market for defense is also very important in this story.
• 6:43
  SPEAKER_01: Do you think improving single market, improving interoperability would practically help the companies?
• 6:49
  SPEAKER_00: No, I think it would help the companies in practice to be cross-border with better standards that cuts across, but also procurement methods and so on in each of the countries that are not super different.
• 7:02
  SPEAKER_00: Every country has, at least for uh some of the most secure things, specific laws that allows them to do only national, but having at least clarity on when what is going to happen and so on, and then taking most of it to not be national but be cross-border.
• 7:21
  SPEAKER_00: So you really have a single market for most things, I think would be super helpful for businesses because then you know the platform you are engaging in and not you know 26 different platforms you're engaging in.
• 7:32
  SPEAKER_01: It sounds like uh great opportunities for companies, also because now we see that member states have increased their defense spending.
• 7:40
  SPEAKER_01: Now it's uh around 343 billion collectively, is the second largest spending in the world after the United States.
• 7:48
  SPEAKER_01: And what would be your opinion on how to make this investment strengthen Europe's own industry?
• 7:56
  SPEAKER_00: So I think it's good that we finally come to the conclusion that we should invest in this.
• 8:02
  SPEAKER_00: But if we also want to be resilient and be a strong Europe in a world that keeps changing, then we should build the defense industry in Europe for at least some of this money.
• 8:17
  SPEAKER_00: That doesn't mean we shouldn't buy from uh some other countries that are part of the NATO alliance and so on.
• 8:22
  SPEAKER_00: That's for sure that has to happen.
• 8:24
  SPEAKER_00: But we should at least spend some of this money to get strong locally so that we are more independent in Europe and not just dependent on all kinds of systems we get from partners around the world.
• 8:39
  SPEAKER_00: In the past we've acquired most outside.
• 8:42
  SPEAKER_00: I think we should acquire more inside of Europe.
• 8:46
  SPEAKER_00: So now we get, like we have with most industries, a more balanced industry where we both import and export.
• 8:53
  SPEAKER_01: Oh, it's indirectly brings us to the finally to the NATO question.
• 8:56
  SPEAKER_01: So looking beyond the EU.
• 8:58
  SPEAKER_01: So do you think it is important that European and NATO requirements work together and rather than be pulling in different directions, is it important for companies, for industries?
• 9:09
  SPEAKER_00: I think that's helpful if uh if we can align the two, because then as European companies become stronger in Europe, delivering to Europe, if it's the same standards, then they also have the opportunity of delivering to other NATO countries without having to redesign and refactor all their products.
• 9:28
  SPEAKER_00: So that I think will be helpful.
• 9:30
  SPEAKER_00: I also think it allows Europe to play a better role in NATO.
• 9:35
  SPEAKER_00: I think there's been quite a bit of push for Europe to kind of carry their own weight inside of NATO, and by having a defense industry inside of Europe that carries some of that weight, I think both Europe and NATO is going to benefit from that.
• 9:50
  SPEAKER_01: We met today to discuss, because you're in Brussels, to participate in the conference to talk to the Commissioner and European institutions.
• 9:57
  SPEAKER_01: In the view of this event, what would be your key message to the Commissioner, to the European institutions?
• 10:04
  SPEAKER_01: I know you will be speaking there about our relatively new positions paper as Business Europe started to work and had defense and security as its priority since quite recent.
• 10:14
  SPEAKER_01: So, what would be the key messages?
• 10:16
  SPEAKER_00: I think the key message is this of that the defense industry and industry in general and the public sector is yin and yang in this one.
• 10:25
  SPEAKER_00: Having one strength and the other, and so on, that's gonna make us all stronger.
• 10:30
  SPEAKER_00: And if anything, then being able to create a framework for how we collaborate on this, a framework that is long-lasting for the private public sector collaboration on this is going to be super helpful as we have many members from the EU attending, then making sure this makes it into a competitiveness fund, making sure that it makes it into the multi-annual budget as well, is gonna be important as they think through these items over the next period.
• 11:03
  SPEAKER_01: Thank you, Klaus, so much.
• 11:04
  SPEAKER_01: I think there is a realization also among the institutions that this is on the agenda and must be on their agenda.
• 11:11
  SPEAKER_01: Because a safer Europe needs a strong economy, and a strong economy also needs security.
• 11:16
  SPEAKER_01: That's really the message at the heart of Business Europe's position on this.
• 11:20
  SPEAKER_01: We'll be taking that conversation further at our event this week.
• 11:23
  SPEAKER_01: And you can read Business Europe's position on our website.
• 11:26
  SPEAKER_01: And for more conversations on the issues shaping European business, subscribe to Expresto Briefings.
• 11:31
  SPEAKER_01: Thanks for listening and see you next time.