Global Security: The New Environment
Mr. Carmelo Cosentino
Senior Vice President, Alenia Aeronautica S.p.A.
The events of September 11 changed the world scenario. Now threats are unpredictable and asymmetric-total global insecurity is the new definition of the international environment. Geopolitically, the new threats are global, and it is impossible to distinguish between domestic and external security issues; insecurity affects all economies because all are interdependent. Because the threats are global, global responses are required, and, as far as we are concerned, they must be framed within the European Union, within NATO, within the U.S. and EU relationship, and within the EU and Russia relationship. The new global security environment is a very complex issue.
U.S. defense policy is currently undergoing strategic revision in two important directions: one toward a more flexible model of alliances, and the other toward reinforcing its defense leadership with a specific focus on research and technology and an increase in the defense budget. Within NATO, the Prague Heads of State and Government Meeting in November 2002 committed the Alliance to new capabilities for the first time. The operational decisions made in Brussels in June of 2003 will reform the command structure.
INCREASING MILITARY INVESTMENT
How can we go from global insecurity to global security? Certainly, integration, interoperability, and more cooperation are crucial elements, all of which must operate at political, military, and industrial levels. More importantly, especially from the point of view of European industries, Europe must learn a lesson about the size of the research and the effort. Europe spends roughly half of what the United States spends on its military budget, but the ratio is not one to two; the real ratio is one to one hundred. A very complex algorithm lies behind the understanding of the cost effectiveness of such an imbalance.
As Europeans, we must understand that increasing military investments not only means more euros but better and more focused euros. Too often we forget the spill-over effect, and a different way of spending will increase European credibility vis-à-vis the U.S. Of course, I speak only at the industrial level, not at the political level.
THE CAPABILITIES OF THE DEFENSE SECTOR
In the complex current environment, industry is the last point in the political-military-industrial chain. Yet industry must provide the means and the tools. Certainly in Italy, where the defense sector is focused around the Finmeccanica group, the number one high-tech defense group, my company, Alenia, which handles aeronautics and space, has a specific role to play. First, we have extensive experience in cooperation. In fact, within Europe, I believe the Italian defense industry has the most cooperating experience with both European and transatlantic partners. And experience is quite important.
Second, we have paid close attention to balancing cooperation between transatlantic and continental areas, making it a kind of bridge across the Atlantic. We have been less structurally oriented in our cooperation with other companies and more business oriented and focused on specific cooperation.
Third, because mergers and consolidations are a crucial way for the industry to become more competitive, providing tools that are not only good but also cost effective, Italy and particularly Finmeccanica face consolidations and mergers in a particular way. We look less on the structure of the consolidation and more on specific sectorial joint ventures (JVs). A good example is represented by Agusta Westland. We are continuing on a one-by-one and on an opportunity basis, and we are consolidating in specific sectorial groups and JVs.
NECESSARY FUTURE STEPS
What should we do in the future? First, we need to increase our military collaboration with American companies. In the past we have been more active on civil collaborations such as our longstanding relationship with Boeing on commercial aircraft. More recently we started to collaborate with Lockheed Martin on the C-27J and on the JSF. Second, we may need to focus more on European industry consolidation because such consolidations are crucial to staying competitive. And third, we have to move forward cooperating with the Russian system. We already collaborate with that system, but we need to make better and further progress.
ESSENTIAL AREAS FOR DEFENSE INDUSTRY CONCENTRATION
There are five essential areas in which industry must be innovative, inventive, and manufacture good products if it is to provide the tools that will meet military requirements:
- Surveillance systems. Here I will mention the Multimission Maritime Aircraft (MMA) and other aircraft in the ATR family. Italy is indeed looking to Maritime-Patrol replacement.
- Airlift. Mobility is crucial today, and, with the C-27J we developed, we can offer a response to air mobility requirement.
- Tankers. Tankers are essential to improve operational effectiveness. We are proud to have launched the KC-767 tanker with Boeing.
- Combat aircraft. In this complex arena, Alenia and BAE Systems are engaged both with the Eurofighter and the F-35/JSF. This common experience is a unique asset that we intend to bring to the field.
- Unmanned Aerial Vehicles (UAVs/UCAVs). The last area, which will be very important in future applications, refers to Unmanned Aerial Vehicles, in which most industries worldwide are seeking innovative and effective solutions. We are working on this within Europe with such programs as the European Technology Acquisition Program (ETAP), which involves six major European countries. Leaders come not only from industry but also from university and research centers. In May 2003, our group rolled out our first technology demonstrator platform for a new UAV system that in the future will merge with UCAV.
As you can see, the scenario is very complex, and the role of industry is to provide a response to the different requirements. I believe that Europe, and Italy in particular, for the reasons I just mentioned, is in a very good position to provide suitable answers.