Rome '08 Workshop
Finding Operational Solutions: Italy's Approach
Major General Claudio Tozzi
Italian Defense Ministry
The European integration process is leading to a significant increase in intergovernmental cooperation programs, ranging from R&D to production to the creation of transnational defense companies. European enterprises are losing their national identity. This is driving European governments to reinforce their cooperation in the fields of procurement, research, market rules, and exports—all matters that are dealt with in environments such as LOI, OCCAR, and the European Defense Agency. Although the Europeans’ assumption of greater responsibilities in maintaining peace and sharing relative costs is viewed very favorably, worries arising from global competition are still a constraint. This prevents the improvement of cooperative initiatives between the U.S. and EU, which in the foreseeable future will remain the two main actors in the fields of technology and international programs.
ITALY’S COMMITMENT TO FINDING OPERATIONAL SOLUTIONS
In recent years, Italy has been strongly committed to finding operational solutions for promoting a more balanced situation between the parties involved and for allowing greater possibilities for cooperation with the U.S. in the armaments field. Within the framework of the Declaration of Principles, significant agreement on supply security has been achieved. This has led to a way to regulate priorities for defense orders whenever national interests require prioritization, through a system based on voluntary commitment to a code of conduct. Agreements like this have contributed towards creating an environment of greater reciprocal trust, which should lead to further developments in the armaments sector, such as the adoption of an initial fast-track procedure to speed up ITAR authorizations, which could lead to exemption from ITAR regulations altogether.
Italy encourages an innovative approach to multi-partnership programs. For example, the E5 program should be used as a natural platform from which to experiment and reinforce the possibility of greater future cooperation at the governmental and industrial level. On the basis of lessons learned and the experience acquired through system development and demonstration, we believe that an innovative approach will enable the possibility of having future program phases, such as production support and development.
THE NEED FOR CHANGE IN THE EXPORT-CONTROL SYSTEM
However, some changes could be made to the export control system. The traditional U.S. approach has been to have just one American military component in the system and to require authorization by the American government before the component can be reexported. This approach results in the involvement of all component-supply nations and political responsibility for exports to third-party nations. However, significant progress in this sector has been seen in the DOD’s consideration of simplifying the license-granting process for exports for countries deemed reliable, rather than continuing case-by-case assessment, with its unacceptably long lead times.
A far more significant step forward in relations between the U.S. and some selected Western countries can be seen in the defense trade cooperation treaties signed in 2007. These treaties, currently in Congress’s ratification phase, will make it easier to trade military items by eliminating the need for most of the export licenses that companies now must obtain before they can sell to foreign buyers. In practice, instead of requiring a license for each transaction, the treaties create approved communities of companies that can freely buy and sell most military items under certain circumstances. Eliminating the need for most export licenses will also increase joint research, development, and production of defense equipment and expedite delivery of critical warfighting equipment, thus providing greater and lower-cost access to world-class cutting-edge technologies in the U.S., the U.K., and Australia, much to taxpayers’ benefit.
We fully recognize the primary need to prevent equipment from going to potential adversaries, but opening U.S. export control policy could deeply benefit the armed forces, which could be far more integrated and interoperable than they are today. As a matter of fact, treaties such as those mentioned will enable defense establishments to achieve fully interoperable forces and to leverage the strength of defense industries in support of the armed forces. This cooperation will benefit operational defense capabilities by improving the interoperability of equipment and systems for forces who must be able to fight not only in traditional battlefield situations but also when they are faced by asymmetric threats such as improvised explosive devices. By removing barriers to communication and collaboration between the armed forces and defense industries, it will be much easier to counter such threats.
Such new arrangements will help to maintain the strength of the respective defense industries by taking advantage of highly developed technical expertise. For example, as a consequence of the U.S. acquiring important European products, such as the Joint Cargo Aircraft, for both the U.S. army and the air force, the defense treaty community would be expanded to other European countries such as Italy and France and, later, to the whole of Europe. The ongoing process of developing a fully integrated European defense equipment market, in my opinion, is an excellent way to improve transatlantic collaboration, not based on bilateral agreements but on bi-continental cooperation between the EU and the U.S.
RETAINING CAPABILITIES WHILE INCREASING COLLABORATION
The above, in my view, is the real challenge that in the short to medium term must be faced by our governments. But it is my wish that we consider this challenge more as an opportunity rather than as a risk, because a fully fledged transatlantic market could improve the efficiency of the American market as a consequence of increasing competition. Therefore a good solution for the European side is to retain its own key industrial capabilities while at the same time increasing industrial collaboration among its own companies, in order to create a stronger European DTIB in a more and more transparent defense equipment market. In the meantime, it should be very fruitful to foster cooperation with the U.S. in order to develop international programs in common technologies. Renewing such relations between the two shores could be accomplished through the aforementioned multilateral defense cooperation tools OCCAR, the European Defense Agency, and LOI, which have proven their reliability on several occasions.
As for the decline in defense budgets, the way out is rather clear. We need to work better together and to pool our research, technology, and know-how in order to spend our resources in an intelligent way. The key is to encourage all programs that are run in cooperation with other member-nations and to support collaboration between companies. Such behavior will also contribute to avoiding unnecessary competition and will give new impetus to developing common capabilities.
CONCLUDING REMARKS
Every operational solution aimed at balancing responsibilities and duties between European countries and the United States will contribute towards eliminating the obstacles on the road. It will also help to create an efficient defense market and to reinforce the strategic raison d’être of our transatlantic alliance.