[Opinion] The military-industrial complex cashing-in on the Ukraine war
From the outset, arms manufacturers eyed this war as a profitable business opportunity. Structural changes took place across the EU, not only to fast-track arms to Ukraine, but also to make more public finance available to the highly-lucrative arms indust...
The military-industrial complex cashing-in on the Ukraine war Wednesday 28th Dec 2022 Join EUobserver Login Newsletter Headline News Ukraine EU Political Rule of Law Green Economy Health & Society Migration Digital EU & the World Nordics Opinion More Investigations Agenda Editor's Digest Stakeholders Podcast Magazines Search FOCUS ON … EU Presidency Nordic News EU & China Health Digital Agenda LGBTI Rights Join EUobserver Login Newsletter About Us Privacy Policy Corrections Advertising Mastodon Section Opinion Opinion The military-industrial complex cashing-in on the Ukraine war A war on the EU's doorstep has justified a shifting of the goalposts with regard to arms companies accessing ever-expanding sources of public and private finance (Photo: STNGR industries) By Niamh Aine Ni Bhriain Amsterdam, 7. Dec, 13:15 Listen to article Since Russia's full-scale invasion of Ukraine in February 2022 media attention has regularly focused on the military assistance provided by states to bolster Ukraine's war effort with Nato members delivering almost $40bn [€38bn] in military aid to date. Despite this unprecedented outpouring of support, nine months later the war drags on and there has been little public scrutiny of those who are profiting from the misery — the arms industry. Read and decide Join EUobserver today Become an expert on Europe Get instant access to all articles — and 20 years of archives. 14-day free trial. Choose your plan Monthly €19 Short-term commitment Yearly €150 Best value, save 34% Reduced yearly €90 Student or retired? Then this plan is for you. ... or subscribe as a group Don't miss out on Our exclusive news stories and investigations. Influential. Investigative. Independent. Why join? Watch our founder Lisbeth Kirk explain the reasons in this 30-second video. Already a member? Login here. Nato members were already spending 17 times more than Russia on military expenditure before the war and Nato collectively enjoys a superior defence capacity and more sophisticated weaponry. Despite this, since the invasion European leaders have pledged unprecedented increases to their military budget. By mid-May 2022, bloc members had announced almost €20bn in increases with the European Commission considering as a matter of urgency the "short-term need to replenish and expand defence stocks including to compensate for the military assistance to Ukraine". Similarly, the EU earmarked half a billion euros for joint arms procurement and announced future increases to the European Defence Fund, which finances the research and development of arms. Structural changes were taking place across the EU, not only to fast-track arms to Ukraine, but also to make large pools of public finance available to the highly lucrative arms industry. From the outset arms manufacturers have eyed this war as a profitable business opportunity. New research from Stop Wapenhandel and the Transnational Institute reveals that the arms industry has used the sentiment of fear to whitewash its image and position itself as an essential partner that can provide the necessary tools to ensure security. The EU and its member states have been very receptive, having long viewed arms companies as expert allies and key partners, rather than commercial, profit driven entities. In the days following the outbreak of war, an appeal was made by German arms lobby group BDSV for the EU to "recognise the defence industry as a positive contribution to social sustainability" under sustainable finance taxonomy (ESG). In the months that followed, European banks and other investors that previously refrained from engaging arms companies shifted course, partly in response to pressure from governments, and began to look more favourably on ending their exclusion from investment opportunities. On European Defence Innovation Day, European Defence Agency chief executive Jiří Šedivý said that 'the brutal Russian war of aggression in Ukraine vividly shows why we need to urgently strengthen European defence', while the European Commission's high representative for foreign affairs and security policy, Josep Borrell, added that "we either innovate [sic] or we risk becoming irrelevant in the field of security and defence". Though this securitised framing was already ingrained in European policies long before the invasion, a war on the EU's doorstep has justified a shifting of the goalposts with regard to arms companies accessing ever-expanding sources of public and private finance. 20 percent of two percent At the June 2022 Nato summit in Madrid an innovation fund was launched, which will invest €1bn of public money over the next 15 years in 'early-stage start-ups and other venture capital funds'. Nato policy already stipulates that members must strive to invest at least two-percent of GDP in their military budgets, of which at least 20 percent should go to arms purchases. If this trend towards greater leniency continues, it is not inconceivable that arms companies including those involved in the development, production or maintenance of nuclear weaponry, may eventually be able to access funds earmarked for social sustainability projects. If the war in Ukraine has taught us anything it is that militarism does not work. It did not deter Russia from invading Ukraine and engaging in a protracted war, and it will not diminish the terrifying prospect of nuclear warfare — only through nuclear disarmament can this threat be countered, not by militarising further. Despite militarism being a fundamental part of the problem and not the solution, European political and financial institutions, and the arms industry alike, have embraced wholesale the notion of militarised security evoking a common language and deploying terms such as 'competition', 'innovation', or 'enterprise'. Sign up for EUobserver’s daily newsletter All the stories we publish, sent at 7.30 AM. By signing up, you agree to our Terms of Use and Privacy Policy. Vast sums that could otherwise be invested in health, education, and other essential social services, or to offset the excessive warming of our planet and the rising cost of energy, are instead being diverted for investment in the research, development and procurement of arms in an already over-armed world. This is no longer about responding to the war in Ukraine, this is about driving a new arms race. If we take European leaders at their word that Europe must militarise further to counter the Russian threat, but considering how vastly over-armed EU member states already are, when will enough be enough? Building Europe's security on the profit based dreams of arms companies and their shareholders will only fuel future wars and exacerbate human suffering. Author bio Niamh Aine Ni Bhriain is programme coordinator and researcher at the Transnational Institute , the Amsterdam-based NGO founded in 1974 as the international programme of the Washington DC-based Institute for Policy Studies, advocating for justice, democracy, and sustainability. Disclaimer The views expressed in this opinion piece are the author's, not those of EUobserver. , your membership gives you access to all of our stories. We highly appreciate your support and value your feedback. If you have any thoughts on this story, we would love to hear it. Share Article Twitter Facebook LinkedIn Reddit WhatsApp Mail Site Section Opinion Related stories How Nato's Bucharest summit came back to bite in Ukraine Nato renews membership vow to Ukraine Nordic Nato candidates seek no opt-outs on nukes EU aims to ramp up financing for Ukraine How Nato's Bucharest summit came back to bite in Ukraine 17. Mar, 15:41 Was Bush right, to want to offer Ukraine immediate Nato membership? 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