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Critical technologies: challenges and opportunities for the European defense industry.

Avionics and Space

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Aerospace and Defense

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The identification of critical technologies for defense and the promotion of their development are objectives that, within the framework of the Common Security and Defense Policy (CSDP) of the European Union (EU), seek to achieve multi-domain operational superiority and guarantee the strategic autonomy of its member countries.

Russia’s invasion of Ukraine has highlighted the need to update the technologies being worked on and, therefore, the military capabilities associated with them, in order to adapt them to the new geopolitical scenarios.

In addition to their strategic importance to the CSDP, critical technologies, particularly dual-use technologies, also have a far-reaching impact on related civil industries.

In the midst of warlike conflicts that could potentially involve the EU, both the European Defense Agency (EDA) as the most important European Commission (EC) have multiplied their efforts in the review and updating of those technologies and military capabilities that allow them to face present and future threats.

 

What are the initiatives coordinated or managed by the EDA?

During the past 2023, the EDA conducted a review of its Capability Development Plan(CDP ) as well as the set of technologies required for the development and procurement of such Capabilities. This review has served to reflect current geopolitical changes and those that have the potential to affect the EU in the short, medium and long term, considering technological trends and shortfalls in military capabilities.

This is not a new process, since the efforts in the search for the strategic autonomy by the EDA feed back into the so-called Coordinated Annual Defense Review (CARD The first time it will be carried out in 2021-2022 and its objective is to keep the European Prioritiesseeking consistency with NATO’s defense planning process (NDPP (in its acronym in English).

As a result of the first CARD, five areas of recommendations emerged that have been guiding the search for and choice of implementable projects through CE initiatives, such as the European Defense Fund (EDF or the Permanent Structured Cooperation (PESCO (in its acronym in English). All this within the Union’s Multiannual Financial Framework 2021-2027.(MFF ). These areas were:

  • Defense spending
  • Defense planning
  • EU CSDP Operations and Missions
  • Implementation of high-impact capability targets
  • Defense cooperation

 

With these parameters as a reference, several projects classified as “most promising, most urgent and most needed” were identified and, as a result, an update was made to the European Platform for Defense Collaboration (EUCLID which, managed by the EDA, aims to identify those military capabilities in which member countries could find synergies and possibilities for cooperation. The following were identified:

  • Unmanned aerial systems.
  • Light multipurpose helicopters.
  • Cyber operations.
  • Tactical telecommunications and information systems (CIS).
  • Chemical, biological, radiological and nuclear (CBRN) defense capabilities.

 

Part of the second CARD has focused on identifying the technologies with the greatest potential impact on the EU’s present and future military capability, specifically towards the year 2040 and beyond.

 

Emerging and disruptive defense technologies

The set of initiatives analyzed includes emerging technologies that may have implications for related civil industries. In other words, dual technologies. Among others, we can mention:

  • Biotechnology and human factor enhancement
  • Advanced materials and manufacturing
  • Hypersonic weapon systems
  • New space technologies
  • Quantum technologies
  • Blockchain (Blockchain)
  • Robotics and autonomous systems
  • Artificial intelligence

 

When visualizing the spectrum of these technologies in the field of defense, the interrelationship between military innovation and civilian applications is evident.

Out of the whole set, four critical future technologies stand out as requiring further analysis, as they are considered high impact and highly likely to be relied upon by the EU in the next decade: quantum communications and cryptography, space platform, integrated photonics, and nuclear micro reactors.

 

Challenges and opportunities arising from defense technology innovation

Considering all of the above, it is necessary to mention that innovation in defense technology faces important challenges. Such as the shortage of talent and skilled labor, the risk of brain drain, the need to support EU start-ups and the importance of the EU playing an active role in regulation and standardization.

In addition, other important challenges that can be mentioned are:

  • Interoperability between various platforms operating in different domains (land, naval, air, space, cyber and cognitive).
  • Hypersensitized environments, where high data processing capacity is required.
  • Need to develop the ability to establish and maintain secure communications in aggressive environments.

 

In response to the challenges posed, it is noticeable that the EU is beginning to play a more active role in the regulation and standardization of critical technologies. Right now, the CARDs carried out to date have enabled a coordinated approach to regulating critical technologies in the EU, mitigating risks and boosting the development of this essential sector.

However, innovation in defense technology also presents interesting opportunities for related industries. Initiatives such as the EDF or PESCO, allow strengthening the defense industry, thanks to research and development collaborations jointly managed by the EDA and the EC. And, as the PESCO regulations point out, the possibility of also being managed by the Organization for Joint Armaments Cooperation (OCCAR), a non-EU organization with extensive experience in the management of complex cooperative defense programs. EURODRONE or the ESSOR software-defined radio program are good examples of programs managed by OCCAR and at the same time receiving partial funding from the EDF.

Of course, specific measures aimed at the promotion and protection of these technological areas or the corresponding subsets are expected from the regulations.

Likewise, it seeks to reduce dependence on external suppliers of critical technologies under the concept of “strategic autonomy” established in the European Security Strategy of 2016 and subsequently revised during the Spanish Presidency of the Council of the EU in 2023 under the concept of “open strategic autonomy“. In other words, “
to act autonomously when and where necessary and to collaborate with partners whenever possible.
“. The clearest example of this would be the Important Projects of Common European Interest (IPCEI), aimed at semiconductor production within the EU.

Finally, by strengthening and consolidating the European defense industry, local companies will have the possibility to export related products and services globally, generating significant economic benefits for the EU.

The new security and defense landscape being shaped within the European Union requires a multidisciplinary and collaborative approach. It must address the challenges in the right way and increase the benefits derived from these innovations, perceived both in the military capability of the bloc and in civilian life.

A new stage is now beginning after the 9J European elections, which we hope will be one of continuity and support for the many initiatives launched by the various EU institutions in the framework of the development of critical technologies for the security and defense of the old continent. The challenges are defined, the opportunities have already arisen and will continue to arise.

Arturo Alfonso Meiriño, Major General EA (R), member of the Strategy Committee of Grupo Oesía.

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