News item | 02-11-2022 | 17:24
Europe must be more self-reliant with regard to the development and production of defense equipment and ammunition. The Russian invasion of Ukraine underlines this. The increased defense budgets in Europe and the Netherlands give momentum to the extra commitment to a robust and innovative European defense industry. The government will intensify various measures from its Defense Industry Strategy (DIS) by some €252 million in the coming years. Ministers Kajsa Ollongren of Defence, Micky Adriaansens of Economic Affairs and Climate (EZK) and State Secretary Christophe van der Maat of Defense wrote this to the House of Representatives today.
The geopolitical situation and the international threat assessment require close cooperation with partners and allies. That is why the government is now emphatically opting for an active (international and European) industrial policy aimed at strengthening the defense sector. This enables faster action in response to, for example, technological developments, shifts in the (defence) market and/or geopolitical changes.
The Dutch Defense Technological and Industrial Base (NLDTIB) consists of almost 1,000 companies with an annual turnover of €4.7 billion. These companies are important for the transformation of the armed forces and for strengthening European strategic autonomy. The NLDTIB focuses on areas that are important for our national security and in which the Netherlands is strong. The Netherlands is therefore of added value in a European and trans-Atlantic context. These include radar technology, aircraft construction and maintenance, sensor technology and the construction of surface ships. Knowledge-intensive and high-tech Dutch defense companies also play an important role in international supply chains.
Increased R&T budget and more customization
Defense and EZK jointly drafted the DIS in 2018 and are now also joining forces. With an increased budget, Defense will invest more in Research & Technology to grow to € 76.7 million in 2026. So-called short-cycle innovation will also grow to € 90 million in 2026 in order to strengthen ecosystems that are relevant to Defense. Defense has also set aside money to enable co-financing of innovation projects through the European Defense Fund. Through NATO’s so-called innovation fund (NATO Innovation Fund) is being set up in the coming years, venture capital for the development of technology by startups and scale-ups. The Netherlands is contributing to this with a total amount of approximately € 56 million.
The Ministry of Economic Affairs is also paying attention to more customization for the defense sector. EZK’s innovation instruments must be made more accessible, for example through the theme of safety within the Mission-driven Top Sectors and Innovation Policy (MTIB) and DeepTech Fund. The Industrial Participation Policy is also an important instrument for strengthening the NLDTIB and positioning it internationally.
The government is also campaigning for access to financial services by the defense sector. Legislation will be introduced to prevent unwanted investors and takeovers. Defense and EZK want to use these measures to strengthen the Dutch defense industry and claim a strong position within European cooperation and the NATO alliance.
Working visit to Maintenance Valley F-35 in Woensdrecht
Minister Adriaansens and State Secretary Van der Maat visited the Maintenance Valley for the F-35 at Woensdrecht Air Base on 2 November to learn more about this collaboration, also for the local industry. Various companies, such as Boeing, Specto and the Air Force, showed the ministers how the specific defense needs are met together with Defense and EZK, also in an international context. Industry organizations NIDV, VNO-NCW and FME play an important role in connecting Dutch SMEs and start-ups to other (international) parties. The ministers will discuss this with them shortly.
This successful ecosystem at Woensdrecht is a good example. The strength of this Maintenance Valley can be translated to other domains of the armed forces. For example, there is collaboration on the development of a maritime Maintenance Valley in Den Helder, among other things in the context of the acquisition of the new submarines. This requires international coordination, both by government and industry. We want to avoid duplication of developments in Europe.
EU and NATO
There is also an urge within the EU and NATO to jointly increase European industry and military strength. As a result, the importance of cooperation, standardization and interoperability in the acquisition of future equipment has increased. The Netherlands wants to lead the way in this.
More international equipment cooperation will increase joint readiness and prevent fragmentation. The Netherlands wants to play a pioneering role in this. Examples are cooperation with Belgium and Germany and participation in future European and transatlantic defense equipment programmes, comparable to the F-35 programme.