Europe’s security and economic competitiveness are under growing strain. Danish intelligence estimates indicate that Russia could test NATO’s Article 5 in a few years time. Russia spends more than 8% of its GDP on defence, relies on a war economy, and its forces have been battle-hardened in Ukraine. Europe’s woes do not end there. China’s industrial overcapacity and supply chain weaponisation, Trump’s tariff threats, and persistently high energy prices undermine European industries. Right now, the stars are aligned to address the EU’s security and competitiveness crises with a new tool: increased defence budgets. With the Rearm Europe proposal and the NATO pledge to spend 5% of GDP on defence, EU Member States are set to dedicate substantial financial resources to strengthen deterrence. Governments should use these funds to invest in Europe’s long-term prosperity too. There is a mandate for this. NATO’s definition of defence spending already accounts for dual-use goods and R&D ‘when the military component can be specifically accounted for or estimated’. The EU’s Political Guidelines highlight a global ‘fight for a technological edge […] and an increasingly thin line between economy and security’. Both the EU and Member States can drive a dual-use Fourth Industrial Revolution tech boom, supporting the scaling-up of new companies.
When stars align: Leveraging European defence budgets to drive a dual-use tech boom (Joris Teer, Giuseppe Spatafora – EUISS)
Related articles
