EFFECTS OF MILITARY SPENDING ON THE PROFITABILITY OF SPANISH DEFENCE CONTRACTORS

The traditional view of the defence industry obtaining large profits from contracts with the Ministry of Defence relies on several assumptions. Among these are the use of such arrangements as an instrument of industrial policy, the strong market power enjoyed by prime contractors, and the inefficiency encouraged by the sector. The findings show that defence contracts have a positive effect on profits, as well as the prizes for innovation and the market power enjoyed by some defence subsectors.     

A Revolution Too Far? US Defence Innovation,Europe and NATO’s Military-Technological Gap

The United States is launching another defence innovation initiative to offset the growing military-technological might of countries such as China, Russia and Iran. However, by utilising emerging technologies from the commercial sector to achieve greater military power the US may further open up the technology gap within NATO. This raises serious questions for NATO’s European allies. This article probes the nature of the US’s latest innovation strategy and sets it within the strategic context facing Europe today. Whether European governments, firms and militaries will join the US in its new defence innovation drive will hinge on politico-military and industrial considerations.     

DEFENCE SECTOR TRANSFORMATION

Sub-Saharan Africa is a region facing many problems and challenges. Many of the countries in the region are experiencing internal conflicts and others are involved in processes of peace negotiations and post-conflict peace building. All these countries face the challenge of defence sector transformation in order to align their post-conflict defence departments and military forces with the demands of democratic societies. This is more than a demand for a reduction in defence spending and requires a fundamental change in defence policies, management and practises. There are, however, lessons to be learnt from other similar experiences in the region. This article examines some of those lessons and presents a generic model for defence sector transformation in sub-Saharan Africa.     

Defence industrial policy – a sound security strategy or an economic fallacy?

This article explores whether it makes sense for national governments to employ defence industrial policies – such as offsets and discriminatory procurement practices – to support their domestic defence industries. This question has so far primarily been discussed by economists, who have argued strongly against the use of defence industrial policies. This article maintains that these economists fail to address the often complex motivation behind the introduction of these policies. It illustrates these shortcomings by contrasting their arguments against a case study of Norway, which accounts for the country’s use of defence industrial polices from the early post-Second World War era up until today. The article concludes that, depending on their objectives, defence industrial policies can be seen as either a sound security strategy or an economic fallacy.     

What Is Known About Defence Research And Development Spill-Overs?

This article surveys the body of available evidence regarding the spill-over effects of defence R&D. It reviews the routes through which defence R&D spills over to the economy with positive externalities – in terms of new products, technologies or processes; the barriers that impede or block such a process; potential negative repercussions, and the measure of such effects. The main conclusion is that the uncertainty of these effects, and the inaccurate appraisal of their value, hardly supports informed decisions concerning defence R&D policies.     

Small countries and the consolidation of the European defence industry: Portugal as a case study

In this paper, we analyse the dilemma confronted by a small country in relation to the consolidation taking place in the European defence industry. Assuming that Portugal must maintain its armed forces, and must retain a minor defence industry, this industry must be competitive in small niches. Competitiveness must be based on, amongst other elements, technical efficiency and technological change. We investigate this issue, first characterizing the threats faced by the Portuguese defence industry, then investigating its present efficiency and finally, we discuss its role in the consolidation of the European Industry. We conclude that the Portuguese defence industry has no alternative but to opt for innovation and European partnership, which are complementary policies, but which require the active involvement of the stakeholder (i.e. the Government) in effecting these fundamental shifts in direction and emphasis. If this strategy does not succeed, the defence policy should be based on offsets.     

Feeding the Lion: China and defence development in African states

ABSTRACT

In analysing trends in Chinese defence engagement and their impact on defence development in African states, it is important to consider both China's changing policy priorities and its capabilities for the provision of defence support. China's international ambitions and its economic development contribute to its emergence as a key supporter of defence capability development in Africa, occupying a crucial niche as a provider of support, particularly arms transfers, appropriate to evolving local requirements. The economic and politico-military imperatives driving China's engagement of Africa, which stem from its economic reforms and re-emergence as a great power, are facilitating defence modernisation by accelerating the introduction of modern arms in substantial quantities. The commercial importance of arms exports and the growing importance of strategic ties strongly situate China to help sustain processes of defence capability development in African states over the long term.     

European defence industry consolidation and domestic procurement bias

How have European cross-border defence industrial mergers and acquisitions affected domestic procurement bias among the major EU powers? This article departs from the findings of Andrew Moravcsik more than two decades ago suggesting that major West European states had no ingrained preferences for defence industrial autarchy. When cross-national armament projects were derailed, this could be attributed to political efforts of national defence industrial champions favouring purely domestic projects. As former national champions join pan-European defence groups, their preferences are likely modified. Does this shift procurement towards non-European “off-the-shelf” solutions which, according to Moravcsik, are favoured by defence departments? Or does it give impetus to a stronger preference for European as opposed to domestic systems? In this article, procurement patterns in the aftermath of cross-border defence industry consolidation will be analysed. Procurement bias is assessed in two industry segments characterised by pervasive consolidation.     

Brazilian National Defence Policy: foreign policy,national security,economic growth,and technological innovation

ABSTRACT

With the world’s ninth largest economy and comprising nearly 60% of South America’s GDP, 47% of its territory, and 49% of its population, Brazil has become a regional power and an important actor in world affairs over recent decades. This scenario has led the government to re-evaluate its role in the world order, resulting in the enactment of the National Defence Policy, whose objective was to consolidate the country as a regional power while at the same time addressing national security issues, promoting economic development through a series of defence programmes, restructuring the defence industrial base, fostering innovation through technology and knowledge transfer to Brazil, and indigenous research and development. However, the policy’s implementation suffers from several challenges discussed in this article, which may test the capability and competence of Brazilian policymakers, military, industrialists, and other individuals and organisations involved in its implementation.     

To free or not to free (ride): a comparative analysis of the NATO burden-sharing in the Czech Republic and Lithuania

ABSTRACT

The recent rise in the defence budgets among the NATO members reawakens the free-riding dilemma. This article provides an analysis of the defence spending of two new member states, the Czech Republic and Lithuania. Based on the free-riding theory, we explain why some of the new NATO members decide to increase their defence budgets (Lithuania), and others do not (Czech Republic). In contrast to the majority of works which focus either on the US as the biggest spender or on the “old” members of the Alliance, we explain under what circumstances some of the small European states who became new NATO members started to increase their defence budgets even though they do not have to, and the literature suggests that free-riding is easier. In the process, we identify three crucial factors that in?uence the decision-making process in this regard: the level of threat perception, economic situation, and the US pressure.     

From tirpitz plan to schlieffen plan: Some observations on German military planning

This article explains why the EU in recent years has gained an upper hand in Allied defence planning. The development is surprising in light of reforms undertaken by NATO in the mid-1990s and also the 1998-99 US ambition to reinforce NATO's defence planning process with the Defence Capabilities Initiative. The article argues that a number of European governments, notably including the British and French, has been motivated to seek change because NATO's defence planning process has proved difficult to adapt to new low-intensity threats and also because governments seek to control the political development of the EU itself. The article illustrates how these concerns are directly visible in the current EU design for military planning and offers an assessment of future NATO-EU relations.     

The Serbian defence institution: the need for clear policy guidance to improve the Serbian defence planning,management, and command processes

ABSTRACT

The uncritical layering of western liberal defence governance norms and concepts on top of existing legacy concepts has impeded achieving coherent military capabilities and capacities when Serbia’s political and military leadership tried to reform the defence system using Western benchmarking principles and Western countries’ best practices. The process of this change has been more valuable than its actual output, as defined by increased capabilities. Such outcomes should be reflective of policy guidance, and can be thought of as closing the trinity loop of a defence planning system: plans, money and execution. This article addresses two key functional areas of the Serbian defence institution. First, it assesses the current state of defence planning to discern its strengths and weaknesses to ascertain if plans are tied to financial decision-making. Second, a full examination of current Serbian defence management is conducted to discern whether weaknesses exist that distract from producing operational capabilities. Both areas are analyzed thoroughly and some solutions for change are proposed. Also, the article analyzes the appearance of two negative phenomena in the planning process – economization and managerialism.     

Country survey VIII: Federal republic of Yugoslavia

This survey article focuses on defence economics issues and provides data and analysis on the Federal Republic of Yugoslavia's (FRY) defence policy, defence spending, the size of its armed forces, its defence industries and the cost of the civil war. The main section is devoted to the period from 1990 to the present and deals with the following aspects: the situation after the break‐up of the former Yugoslavia, general economic data; the cost of the civil war, the defence budget; the armed forces; the manufacture of armaments and the structure of the defence industry.     

‘Getting COIN’ at the Tactical Level in Afghanistan: Reassessing Counter-Insurgency Adaptation in the British Army

This article reassesses the extent to which the British Army has been able to adapt to the counter-insurgency campaign in Helmand Province, Afghanistan. While adopting Farrell's definition of bottom-up military adaptation, this article contends that the task force/brigade level of analysis adopted by Farrell and Farrell and Gordon has led them to overstate the degree to which innovation arising from processes of bottom-up adaptation has actually ensued. Drawing on lower level tactical unit interviews and other data, this article demonstrates how units have been unable or unwilling to execute non-kinetic population-centric operations due to their lack of understanding of the principles of counter-insurgency warfare.     

How to Last Alone at the Top: US Strategic Planning for the Unipolar Era

This article investigates how key actors within the US defence policy community realigned their interests to forge a new consensus on the redirection of US defence strategy following the ‘peace shock’ they faced with the collapse of bipolarity. This consensus centred on the idea that achieving US security in the ‘age of uncertainty’ demanded overwhelming US military power, which was widely interpreted as necessitating military capabilities to fight multiple major theatre wars simultaneously against regional ‘Third World’ adversaries. This helped to preserve many of the principal pillars of US Cold War defence policy through deflecting calls for more radical organisational changes and deeper cuts to defence budgets.     

Covert radio communications: a viable tactic for international terrorists?

Covert operations by underground groups, such as transnational terrorists, are not new and neither are the methods members of these groups use to communicate in their shadowy world. In this regard, one of the enduring myths is that the main means these covert operatives use to communicate within their cell structure are telephones and emails in their various manifestations. This article critically discusses the possible use of wireless transmissions by transnational terrorists as a reliable form of communications. To critically discuss this proposition, a force field analysis was used to assess the theory that radio is a viable option. Implications of this study's findings are considered in terms of the ramifications they have for defence and security policy.     

Fighting Separately: Jointness and Civil-Military Relations in India

How do countries transition from single service to joint operations? This article engages with the discussion on military innovation to argue that civil–military relations are the most important driver for jointness. In doing so it examines jointness in the Indian military. Relying on archival research and primary interviews this article sheds new light on the operations of the Indian Peacekeeping Forces (IPKF) in Sri Lanka from 1987–1990, the 1999 Kargil War and the Post-Kargil defence reforms. The main argument is that the Indian military’s transition to jointness has been ‘incomplete’ primarily because of its prevailing model of civil-military relations. This model prevents civilians from interfering in the operational issues of the military, including on matters pertaining to jointness. It therefore recommends more forceful civilian intervention to overcome the prevailing single service approach.     

SECURITY GOVERNANCE IN SOUTH AFRICA

In the ten years since the establishment of South Africa's first inclusive democratic government, an ambitious, extensive and systematic process of reform has been carried out in the governance of security. The process is widely regarded as having been successful and a model for other processes of ‘security sector reform’ in the context of transitions from authoritarian forms of governance to democratic ones.

That this been achieved with hardly a shot fired in anger is a remarkable achievement and a credit to visionary political leadership as well as organisational capacity, in other words to effective security governance.

At the same time, progress has been uneven and sometimes fragmentary, policy intentions and commitments have not always been translated into practice, the end results have not been to everyone's liking, and transformation has engendered its own pathologies. Thus several challenges remain in improving security governance.

This article provides a broad overview of the roles played by the various actors in the governance of the security sector, including the executive, parliament and civil society. It examines the main policy frameworks and touches on organisational transformation, because it is impossible to deal with governance in isolation from these issues. Policy processes and the frameworks they give rise to—in particular—are critical for effective governance. This article deals with the defence, safety and security and intelligence fields. A comprehensive overview would need to include the governance of criminal justice and foreign policy. The article does not seek to make an overall evaluation of governance, but to identify achievements, shortfalls and challenges.     

Operational idealism: doctrine development of the Chinese People’s Liberation Army under Soviet threat, 1969–1989

This article analyses the doctrine development of the People’s Liberation Army (PLA) coping with the Soviet military threat between 1969 and 1989. In the 1970s, the PLA applied a doctrine of ‘active defence and luring the enemy into depth’ based on its traditional operational art. In 1980, the PLA decided to focus its doctrine on positional defence. In 1986, the PLA introduced ‘integrated operations and prioritised strike’, a generalised doctrine that originated from its war history. Many organisational and intellectual challenges in peacetime doctrine development contributed to the PLA’s operational idealism, including its aging leadership, command structure, attitude towards its previous experience, limited analysis of contemporary military developments, and failure in test and validation of doctrines. In the post-Cold War decade, many of these challenges persisted in spite of military modernization efforts. The ongoing military reform has to address these challenges and improve the PLA doctrine development in peacetime.