DVIDSHUB, via Flickr

The issue of European weapons and military equipment being sold to governments in the MENA region is hotly debated. A lot has been written on the pros and cons, focusing on the tension between the business interests of the exporting industry, the quest for regional stability and the protection of human rights in the Middle East. However, this view reduces the exporters’ interests to their economic dimension, thereby ignoring a major aspect: omitting the geopolitical relevance of the topic – not only for the Middle East but also for the exporting countries – means underestimating its potentially existential long term importance. This holds particularly true for the case of Germany, number 1 exporter within the EU (see SIPRI trends in International Arms Transfers 2014).

The inevitable consequences of a vanishing home market

European arms manufacturers are increasingly dependent on external markets in order to ensure their survival: since the end of the Cold War, some armies in Western Europe have shrunk by a factor of four or more. Sales on the home market are hence insufficient to justify the costly research and development necessary to launch new products. These days profit, and thus the related re-investment in technological progress, is mainly financed through exports. This sets European manufacturers apart from their competitors in the US or in Russia, where the home market still stands for huge shares of business in the domestic industry.

European industry instead has to focus its activity on the most promising external markets – countries with high military budgets (and propensity for conflict) and a low level of domestic production. This primarily applies to countries in Latin America and the Middle East. Although it cannot seriously be considered without comprehensively taking into account the consequences of implementation, further restriction or discontinuance of exports to these geographical areas marked by instability might be a wise political choice to prevent an ongoing escalation of regional conflicts.

Two (im)possible ways to avoid further exports to the MENA region

One of the options would be to compensate for the lost MENA market by boosting the national defence budget and restoring a lucrative home market for domestic producers. Research and development would then be fully government funded. To follow this approach would mean to heavily subsidize or even nationalize the domestic industry, which would come at a very high cost for tax payers. In the long run, such a strategy might be easier to implement – although still costly at the EU level – through a consolidation of the industry and its coherent adaptation to the needs of the European market(s). Several bodies such as the European Defence Agency are already working towards that goal. However, diverging national policies are likely to hinder this communitarian process for obvious geopolitical reasons.

The second option would be to stop completely contested arms exports and to accept the unavoidable decline of the domestic defense industry. As a result of harshly reduced business volume, investments in research and development would need to be cut, leading to an immediate loss of competitiveness and technological leadership and eventually to the industry’s shutdown. The national armed forces would hence be forced to rely increasingly on imported materials for state of the art equipment. Since international exporters tend to reserve their high-class products for their home market, good equipment will be even more difficult to obtain, leading to a relative downgrade of the national armed forces. In the long run, their operational capability and capacity to provide national defence will depend on the willingness of third exporting countries to provide equipment. In neorealist terms, this development corresponds to a loss of defense capabilities leading to an unfavorable repositioning of the country in international relations.

Geopolitical debate or return to pragmatism?

Against this background, calling for an immediate stop of exports to the MENA region reveals a pacifist attitude, including the readiness to relinquish the capacity to defend national sovereignty or to get rid of neorealist thinking altogether. As valuable and legitimate as this approach might be, it potentially implies far-reaching consequences. Further debate should hence be opened to the geopolitical dimension concerning both the importing and the exporting region – or return to the grounds of pragmatism, focusing on the specific cases under scrutiny without challenging in principle the fundamental role of arms exports to the MENA region.

Nicolas Fromm is a PhD candidate at the Helmut Schmidt University Hamburg. He writes his doctoral thesis on “Constructivist niche diplomacy: On the strategic use of normative authority and Qatar’s mediation initiatives 1995-2013 “.

The opinions expressed in this blog contribution are entirely those of the author and do not represent the positions of the Dahrendorf Forum or its hosts Hertie School and London School of Economics or its funder Stiftung Mercator.