Brexit and defence negotiations

In the enthusiasm about the EU’s numerous new defence initiatives in Germany, a discussion of the consequences of Britain’s withdrawal from the union is often curiously absent. Close alignment between post-Brexit Britain and the EU-27 in the area of defence is proving more difficult than many expected.

Even though the UK initially set up EU defence policy, CSDP has not been a priority for British governments for years. Other member-states, meanwhile, have often been happy to support EU defence rhetorically, while cutting defence budgets and concentrating their spending on national priorities.

The irony of current EU debates on defence is twofold: first, the EU is starting to get more serious about supporting defence co-operation, and thus could be potentially more interesting to London just as the UK is on its way out. Second, Britain cannot afford to lose the EU’s goodwill in other areas of Brexit negotiations over defence and so finds itself giving at least a tacit blessing to new initiatives, some of which it would have previously blocked.

The EU strives both to improve the ability of its members to deploy together in military operations, and to cut down the duplications and redundancies of the European defence market. Both strands of activity are affected by Brexit.

To support defence industrial co-operation, in June 2017, the Commission launched a proposal for a new ‘European defence fund’, to finance defence research and development of new military technologies. The fund tries to solve some of the underlying problems that weaken the European defence technological and industrial base.

The Commission wants to address dwindling European demand by including a budget for defence in the EU’s multiannual financial framework for the first time. Through the fund the Commission aims to incentivise member-states both to spend more money and to spend more wisely, by working together. It is yet to be seen if the fund survives the EU’s budget negotiations, and if the money provided will indeed make a difference to Europe’s defence firms. But officials and defence firms in the UK are concerned already.

The EU is currently developing strict regulations that could make all third country participation in defence fund projects very difficult. Even though these restrictions are mainly targeted against US-based defence companies, they will apply to Britain once it leaves the EU. Brussels wants to use the defence fund to incentivise Europeans to co-operate in defence capability development. By shutting the UK out, the Commission is forcing member-states to decide between taking part in the EU scheme or working with British companies.

On the operations side, the Brexit story is a slightly different one. Being plugged into EU operations matters to Britain less because of their operational value than because the UK has an interest in influencing the EU’s strategic direction, regional priorities and level of ambition. The UK also wants to prevent EU-NATO duplication.

In order to be able to remain part of the EU’s defence debate, however, Britain will have to demonstrate its commitment to the EU’s military efforts. The UK could negotiate an agreement to provide troops and assets to the EU – such as Britain’s strategic airlift capability, which helps the EU deploy more rapidly – in exchange for close consultation and information sharing in the early stages of EU operational planning.

PESCO, or permanent structured co-operation, is a new EU political framework that aims to help EU countries develop military capabilities together and improve their ability to deploy them. Britain tolerates and even supports the PESCO initiative, knowing that its provisions will not bind the UK after Brexit.

Should PESCO indeed become the new preferred format for European to launch operations and missions together (a prospect that is currently at least questionable), its members may in the future decide to invite third countries to participate in operations and projects if they provide “substantial added value”, but only with the understanding that they have no decision-making powers in the governance of PESCO.

This aligns with the restrictive stance the EU takes towards all third countries when it comes to operations: third countries are not involved in shaping the strategic direction of operations, including through the drafting of detailed plans for the operation or participation in force generation meetings.

While the UK is open to making continued contributions to EU operations or missions, it would want its involvement in the operational planning to be “commensurate and scalable” to its contribution, meaning that the higher the risk to troops and the bigger the UK’s contribution, the more influence London wants to have over decision-making.

The UK government is confident, however, that it will be able to deploy with its European partners if a crisis develops, either through NATO, through a flexible ‘coalition of the willing’ or through a new format: France has recently proposed a European Intervention Initiative, which would enable European countries to develop a shared understanding of crises and a shared strategic and military culture. Paris has made clear that it intends to set up the initiative outside the EU’s institutional structures, in part to increase operational flexibility and speed, and in part as a means of involving the UK in European military operations after Brexit.

In the area of operations, then, it is the EU that loses out from a lack of post-Brexit agreement – if in the event of a crisis there is no good option for EU member-states to cooperate with the UK, countries will find other formats to deploy together, thus undermining the EU’s plans.

The defence part of the Brexit negotiations should be a clear positive sum game, where both sides benefit from close cooperation: Britain is one of the only European countries with a credible defence posture, and the EU benefits from keeping it close. Similarly, even after Brexit, Britain will remain a European liberal democracy, with almost identical security interests to the remaining EU member-states – it should try to maintain as many links as possible to the 27.

Sophia Besch is a research fellow at the Centre for European Reform.