Conclusions and Policy Implications
As set out in the Final Report to the European Commission, January 2001

General Political Economy

4.2.1 In the context of the stage in the evolution of global political economy which emerged during the nineties, we conclude that a new, internationalised (but not yet globalised), arms economy is taking hold.

4.2.2 Economic and security challenges are becoming closely intertwined. They are doing so within a world in which only one military superpower now exists, and in which that military superpower is also the most powerful economic actor. Hence the role of the United States in shaping the future of the arms economy, as of so much else, is crucial. The internationalisation of the arms sector both revolves around, and is developing in opposition to, the United States.

4.2.3 How the relationship between military doctrines in the United States and Europe, and the corresponding configurations of arms industries, will develop on the two sides of the Atlantic is not so easy to state. Indeed, it should be the subject of further research. Much will depend on how far political and security agendas converge or, contrarily, remain distinct. In this respect, the legacy of Kosovo may prove to be a touchstone.

4.2.4 All the signs are that the US political system in general, and the military in particular, continue to regard peacekeeping and peacemaking interventions in a different light from their European partners. That is to say, whereas in Europe such interventions have come to the fore in defence debates, and traditional Cold War concerns have moved to the rear of the stage, no such clear shift has occurred in the United States. One might put the point more strongly: what, in Europe, is now regarded as perhaps the prime function of military forces is still seen in the United States as a distraction from the proper role of the military.

4.2.5 To the extent that the purposes of US and European military forces remain distinct, this is likely to lead to different military requirements and therefore to different equipment requirements. What is less clear is whether this will lead to different structures for the arms industries. Put in different terms, the policy networks on the two sides of the Atlantic might grow no closer together than they presently are; but this does not necessarily mean that the same will apply to the production networks. Indeed, an important question for future research is to consider what effect the growing number of transatlantic defence firms may have on the dynamics of these processes. Will these international firms, through their interactions with multiple national policy networks, tip the scales towards some form of policy convergence (in a transatlantic version of Monnet's European functionalism of the 1950s), or will policy networks, and their agendas, retain relatively separate identities?

4.2.6 Kosovo may also prove to be a touchstone in a second sense. The debate over how to respond to the crisis reflected a wide range of political cultures, geopolitical priorities, and economic interests, and these ran deeply within as well as between national political systems. With the resolution of the crisis, one question for history will be what effect it has on the views of military equipment requirements for the future. Kosovo confirmed what the Gulf War had already shown, namely, a vast transatlantic technological gap, and a corresponding gap in capacity to field appropriately equipped forces, for a campaign of the sort that was conducted - with precision bombing, information warfare, dependence on highly advanced intelligence gathering technologies, and so on.

4.2.7 Some would argue that this gap need not drive future policy and production choices, because the campaign, as conducted, was not an appropriate way to attempt to resolve the crisis. Others will draw a different conclusion, namely, that Europe will remain unduly dependent on the United States for any similar future circumstances unless it can equip its forces to a level approaching that of the United States, and in the types of technologies that featured over Kosovo. For the latter, and this is the dominant position in most western capitals, the issue is whether to seek ways to buy from the United States, using partnership arrangements at both policy and production levels to try to retain such independence of action as can be achieved, or whether to press wholeheartedly for a largely independent European defence equipment development and production capability.

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