BITS Research Report 00.3 November 2000

The European Union's Common Foreign, Security, and Defense Policy

Denise M. Groves

This report is also available as a PDF-File

2. What Does It All Mean?

After a series of consultations and summits that have resulted in pronouncements of ambitious plans and the establishment of a multitude of committees, the European Union edges ever closer to the formulation of an elaborate architecture for a common foreign and security policy than ever before. But behind all the formalities and proud rhetoric, what does it all actually mean? According to Javier Solana, the EU's appointed representative for the CFSP, the development of the CFSP reflects the very credibility of the European Union.⁶⁴ If that is true, given the time and investment that has already gone into making the European Union what it is today, then broader and more intensive discussion about issues central to the CFSP would seem to be necessary in order for the EU as an institution to succeed. This discussion must necessarily include analysis of the EU's conflict prevention and management goals, the effect of the EU's mandate on international law and international organizations such as the UN and the WEU, as well as an assessment of how the CFSP may affect relations with Russia, with the US and within NATO, and of the impact on military capabilities and defense spending.

2.1. Balancing Military versus Non-Military Capabilities

One fundamental question that must be addressed is that of the balance between the military and non-military elements of the EU crisis management capability. In June, 1999, the Cologne European Council declared that it "should have the ability to take decisions on the full range of conflict prevention and crisis management tasks" as outlined by the Petersberg Tasks. The use of the term "full range" would seem to imply an equal emphasis on also addressing the non-military aspects of conflict prevention and crisis management. However, since the Cologne Summit, the EU has mostly concentrated on nurturing its crisis management ability vis-a-vis the Rapid Reaction Force. Well defined goals, clearly established deadlines, and multiple committees support the development of the Force. Furthermore, towards the end of the French Presidency, there is to be a formal force generation conference to determine how the RRF should be adequately armed and what acquisitions will have to be made.

The fact that the EU is concentrating on this aspect of the conflict management is intriguing not just because it represents European aspirations to conduct military operations on their own, but also because of the institutional mandate of the force to undertake humanitarian and peacekeeping missions. During the 1990s, military forces were frequently deployed to countries scattered around the globe, tasked to provide humanitarian assistance or operate as peacekeepers. Some observers promoted these types of missions as a practical redefinition of the role of the military in a post-Cold War environment. Others, including certain American officials, were hesitant to accept that role and became increasingly reluctant to commit to military forces to humanitarian or peacekeeping operations. For example, Secretary of Defense William Cohen said shortly after the Kosovo war that "Peacekeeping is not a primary mission, certainly of the US forces, and I suspect that is the case for many of the other NATO countries as well. Peacekeeping involves a different type of training, and capabilities."⁶⁵ In this light, it is notable that the Amsterdam Treaty embraced the humanitarian and peacekeeping duties described as the Petersberg Tasks. Furthermore, the decision to build a Rapid Reaction Force that will operate within the bounds of the Petersberg tasks demonstrates that the EU has every intention to undertake missions that the US does not consider to be "primary." This divergence of views is significant. Some have warned that this divergence could lead to a "two-tier alliance" where the Europeans focus on low-intensity situations such as peacekeeping while the United States or NATO does the "heavy lifting" or the "dirty work at the high end of the spectrum."⁶⁶

While the RRF and the adoption of the Petersberg Tasks signals a European commitment to active involvement in the kinds of crises that had previously festered unanswered in the Balkan region, emphasis on the military strength of the crisis management capability would appear to be an unfortunate development. By pursuing a crisis management approach that largely prioritizes military means, the EU could be neglecting some of its greatest strengths.⁶⁷ Historically the EU is a non-military organization that has achieved the complicated feat of bringing 15 sovereign states — some small nations, some regional powers – together under one umbrella. Furthermore, the EU successfully combines NATO members with neutral and non-aligned members. As a crisis management and conflict prevention actor, this multi-faceted organization has a good record and an immensely wide range of practical experiences, skills, and tools at its disposal. Moreover, the European Union dispenses huge amounts of humanitarian aid, and is the world's main supplier of Official Developmental Assistance, providing roughly 55% of total ODA. The EU is also the most important trading partner and investor for developing countries around the world. ⁶⁸ Therefore, an EU crisis management or defense policy that follows an approach focused on development of military capabilities could risk detracting from the strength and benefits of the EU's diplomatic and economic prowess.

However, the EU should not be limited to providing only economic and diplomatic assistance in crisis situations. This would deny the EU of the ability to effectively address complex emergencies that usually entail political, economic, humanitarian, as well as military elements. Instead, the EU needs a crisis management strategy that balances both military and non-military components and enables the EU to address the full spectrum of a crisis.⁶⁹ This must include a balanced distribution of resources and support in order for both the military and non-military tools to be effective.

In this context, one priority for the near future should be to re-emphasize the role of non-military crisis management and to encourage better civil-military cooperation. There is increasing acknowledgement that this type of cooperation is an essential and inevitable element if crisis prevention and particularly crisis management are to be improved. For example, during the NATO Parliamentary Assembly's 45^th Rose-Roth Seminar in March 2000, experts gathered to discuss the topic of "Military Involvement in Civilian and Humanitarian Missions."⁷⁰ Although this topic and the various facets involved remain a popular source of debate, military and civilians experts present at the seminar generally agreed that better civil-military cooperation and consultation is necessary — particularly in complex emergency scenarios like the conflict in Kosovo in 1999. Michael Clarke, Director of the Centre for Defence Studies in London, pointed out that the inherent capabilities of the military make it uniquely qualified to perform many of the tasks needed during humanitarian crises. This is largely because the military is well organized and better equipped to deploy personnel and materials around the world in a rapid manner.⁷¹

This fact may offer a partial explanation for the EU's emphasis on developing military capabilities. Nevertheless, the EU should not rely exclusively, or even too heavily, on the military for success of crisis prevention and management. Chris Patten's suggestion to lay out equivalent "headline goals" for the non-military side of crisis response is a healthy first step in that regard. The Presidency Conclusions issued at the Feira Summit also demonstrate that EU leaders are beginning to move in a direction that could augment their ability to not only "win the peace" but also to ultimately contribute to the stated goal of conflict prevention. The commitment to be able to deploy 5000 police officers by 2003 and the stated intentions to improve the EU's ability to restore law enforcement and civil administration services to crisis areas is laudable. But the continued references to the fact that EU members have already accumulated considerable resources is disappointing and misleading for at least two reasons. First, although the EU seems to believe there are sufficient resources to address the civilian aspects of crisis management, there are currently serious staffing shortages in Kosovo for exactly that area of work. In the spring of 2000, there was even a somewhat desperate call for personnel on the EU's External Relations web-site to fill vacant positions in the UN's mission to Kosovo. Second, whereas there is a capabilities conference for the establishment of the Rapid Reaction Force planned for this November, there is no comparable capabilities conference scheduled for the EU's non-military functions. Under this lens, the contradiction between the EU's rhetorical commitment to conflict prevention and its actions becomes very clear.

To follow up with Patten's call for non-military headline goals, one step the EU might consider is instituting a standard model for training civilian personnel in methods of mediation, stress management, human rights, international law, election monitoring, etc. Through the cultivation of a corps of experts, each equipped with common training and educated in civilian "rules of engagement", the EU could more rapidly draw together a team able to respond to a simmering crisis situation. The institutional experience of the Organization for Security and Cooperation in Europe (OSCE) and its plans to develop Rapid Expert Assistance and Co-operation Teams (REACT) provide a basis for this kind of plan.⁷² In fact, in the interests of avoiding unnecessary duplication (or conversely, condemning OSCE plans to failure for lack of resources or political support), the EU could combine its efforts with the OSCE to build more effective non-military capabilities.⁷³

2.2. International Organizations and International Law

The position the EU takes on international law issues and regarding the authority of other international organizations is another issue that will confront the EU in the future. In terms of crisis management, concerns center around the issue of whether the EU would undertake a military crisis management mission in the absence of a mandate from an appropriate body such as the United Nations and the OSCE. By restricting itself to only those missions approved by such a mandate, the EU would make an important gesture in reaffirming the importance of international organizations and international law. The Presidency Conclusions issued at Helsinki confirmed that decisions on when and how to employ the EU's crisis management capabilities will take place "according to the principles of the UN charter and the principles and objectives of the OSCE Charter for European Security" as was directed in the Treaty on the European Union.⁷⁴ The Petersberg Declaration of June 1992, which defined the types of tasks the WEU could undertake, stated that decisions to use military units will be taken "in accordance with the provisions of the UN Charter." ⁷⁵

It remains to be seen whether these guidelines will be interpreted to mean that the EU will actually require a mandate from either of these organizations to act. It is plausible to consider that some EU states could simply repeat the interpretation employed by NATO to justify its military operations against Serbia in 1999. In that instance, NATO maneuvered around the absence of a Security Council mandate by defining its actions as being in accordance with previous Security Council resolutions relevant to the Kosovo conflict as well as the principles of the United Nations Charter. The North Atlantic Treaty, the founding document of NATO, recognizes that the United Nations Security Council has the "primary responsibility for the maintenance of international peace and security."⁷⁶ The text of the EU's Helsinki Summit Conclusions, under the heading "Common European Policy on Security and Defense," adopted exactly the same language.⁷⁷ Notable in these communications is the fact that while both entities accept the "primary" responsibility of the UN Security Council, as it is laid down in Article 24 of the United Nations Charter, NATO's use of military force in the spring of 1999 without a UN mandate implies that NATO does not recognize that the UN might have "exclusive" or "sole" responsibility. Short of explicitly stating that the EU would not undertake any operations without a mandate from the UN Security Council, the EU could conceivably exploit the same loop-hole NATO did in 1999. If the EU adopts a similar exploitation of the imprecision of the term "primary", the EU could further weaken the role and authority of the UN, as well as the OSCE, in international affairs.⁷⁸

There is a reason why the EU might choose to avoid expressly requiring UN permission to conduct its operations: if the United States were opposed to an EU contingency, perhaps because it feared that such an operation would weaken the readiness of NATO, it could exercise its veto power within the Security Council. If the EU does pronounce that it will act only with a UN mandate, that would theoretically mean that the EU would require the permission of the United States to undertake a crisis management operation.

On the other hand, some US officials suggest that they would actually prefer that the EU avoid limiting itself to act only with a UN or OSCE mandate. Before the NATO operations over Kosovo began in early 1999, there had been hesitation among some Allies to launch military operations without permission from the UN. Indeed, Congressman Doug Bereuter remarked that "many EU members who are allies wanted NATO's new Strategic Concept to declare that NATO will undertake out-of-area operations only with a UN mandate. The United States at great effort vetoed that."⁷⁹ If the EU were to impose such a restriction on itself, US officials like Bereuter wonder whether or if NATO will be able to foster consensus for action if a UN mandate is unattainable.

Nevertheless, the fact remains that there are members of the European Union who were definitely uncomfortable with NATO's actions absent the UN mandate and will certainly be reluctant to sanction an EU operation under such circumstances. For example, a representative of the Finnish government has stated that her country will not participate in peacekeeping or crisis management operations without political authorization from the UN Security Council or the OSCE.⁸⁰ Austrian politicians have argued that a UN or OSCE mandate is needed for moral legitimacy.⁸¹ French President Jacques Chirac declared that "ultimately, it is the prerogative of the United Nations Security Council, which is the only body with the international legitimacy to decide on the use of force."⁸² Although a consensus is not needed within the EU to launch a crisis management operation,⁸³ as is required in NATO, the question still arises, will the EU be able to foster the collective will to respond to a crisis whether or not there is a UN mandate ? This question is not simply academic: it was exactly because of Europe's indecision and paralysis that rapid responses to each of the Balkan crises were not manageable.

2.3. The Fate of the WEU

Another major question that must be answered as the EU frames its military crisis management capability involves the fate of the Western European Union.

In theory, the Western European Union could act as the guinea pig for the construction of the EU's autonomous force structure. After all, the European Union has been preparing itself for a military role for some time and had already anticipated the need to adopt an ever closer relationship with the WEU, a dormant security organization whose membership is very similar to EU membership. As far back as 1991, the objective had been to "build up the WEU in stages as the defense component of the European Union.⁸⁴" The possibility of integrating the WEU into the EU was also reaffirmed in Article 17 of the 1997 Treaty of Amsterdam. At the meeting of the WEU Ministers in Luxembourg in 1999, the Council of the European Union was granted direct access to the expertise of the WEU's operational structures, including the Secretariat, the Military Staff, the Satellite Center, and the Institute for Security Studies. The WEU has already moved to Brussels, has harmonized its Presidency terms with that of the EU, and perhaps even more significant, the Secretary General of the WEU is also the EU's High Representative for the CFSP. Through these and other measures, the WEU has been set firmly on the path towards eventual integration into the European Union.

The main problem with integrating the WEU into the EU arises when the collective defense commitment of the WEU's founding document, the Brussels Treaty, is considered. The WEU's full members are hesitant to renounce the Article V defense commitment — which is actually stronger than that of NATO's Washington Treaty — yet it is very difficult to incorporate it into the EU partly because of the membership of the four neutral states, Austria, Finland, Ireland, and Sweden. In addition, Associate Members of the EU, most notably Turkey, have expressed their own concerns about how their acquired rights within the WEU would survive the integration since they are not members of the EU. ⁸⁵

Nevertheless, the EU has taken rapid steps towards dissolving the WEU and transferring its major components into the European Union. As called for in the Amsterdam Treaty, the measures being adopted now are intended to clear the way for the integration of many of the functions of the WEU into the EU.⁸⁶ Currently, plans call for the satellite-imaging center in Spain and the Institute for Security Studies in France, as well as a number of security arrangements, to be transferred into the EU. The Western European Armaments Group (WEAG) will remain separate and will continue to function as a distinct entity.⁸⁷ This step has been deemed necessary primarily because membership of the WEAG includes such non-EU states as Turkey and Norway. The EU is also apparently considering maintaining the independence of the WEAG in order to coordinate European research and defense spending.⁸⁸ But perhaps more importantly, the WEAG's survival as a separate entity will also serve to host the Article V collective defense commitments until the EU can determine exactly what the fate of the defense commitment will be. There have been suggestions that the Article V commitment could be attached to the Treaty on the European Union as a protocol, leaving the option open for Member States to sign up to it or not. However, critics of this idea argue that a protocol would not be a suitable way to deal with a matter as important as a collective defense commitment. ⁸⁹

Other legal implications of abolishing the WEU also remain to be reconciled, particularly the legally binding arrangements that have been negotiated between the WEU and NATO. These include agreements on intelligence sharing, the Combined Joint Task Force, the Eurocorps, and non-duplication of assets.⁹⁰ In order to renegotiate these agreements with NATO, or at least form similar but new agreements, the EU has established several working groups with NATO that will attempt to draft compromises on these matters.⁹¹ Through these informal consultations, the EU and NATO may eventually come to some agreements. However, it is unlikely that final arrangements can be achieved in time for the Nice Summit.

The ultimate fate of the WEU as an institution, however, is unclear. At the Cologne Summit, the European Council had stated that after the EU takes over the functions of the WEU (at that time scheduled for the end of 2000), the WEU as an organization "would have completed its purpose." But it is clear that the process of integrating the WEU into the EU has been hampered by many complex problems. It now seems that the EU has taken a less ambitious approach to dissolving the WEU and has at least tacitly chosen to keep parts of the WEU independent and alive. This is a pragmatic decision because so long as some semblance of the WEU survives, it can play host to the WEAG, the associate member states, the Article V commitment, and the binding agreements with NATO — all problems the EU has thus far failed to resolve. In this sense, the WEU also continues to act as a both a buffer between the EU and NATO as well as a mechanism the EU can employ should it decide to conduct an operation using NATO assets.

2.4. The EU's Relationship with Russia

Undoubtedly one of the most important matters the European Union must handle in the context of its CFSP is its relations with Russia. Considering the EU's plans to expand membership eastward, the policies and instruments the EU chooses to adopt now will have a direct effect on Russian interests. That is, if the European Union expands to include former Soviet states such as Latvia, Lithuania or Estonia, the EU — complete with its 60,000 strong Rapid Reaction Force, a mandate to respond to Petersberg missions, and possibly someday a collective defense element — would be rubbing up against Russia's borders.

On an individual governmental level, relations with the power in the east have always been extremely important. Consequently, Russia was an obvious target for EU leaders in the development of the EU's first Common Strategy within the framework of CFSP at the Cologne Summit in June, 1999. It is a strategy that addresses a wide scope of issues that reflect the nature of Europe's complex relationship with Russia. It promises cooperation and assistance for matters such as reforming Russia's domestic economic policies, privatization, land reform and banking reform. It also promotes cooperation with regard to energy policies, nuclear safety, environmental issues, and the fight against organized crime. The EU's clear strategic goals emphasize the importance of a stable and democratic society in Russia and the maintenance of stability and security in Europe as a whole.⁹²

Geographic proximity is not the only reason why Europe is so closely tied to the fate of Russia: the Common Strategy notes that while the European Union is Russia's main trading partner, Russia also provides significant energy resources to Europe. The close economic nature of the relationship could therefore explain why Russia maintains a benign view of the European Union and has thus far expressed comparatively little alarm regarding the CFSP and EU enlargement. In fact, one analyst has noted that the general public in Russia has very little knowledge of the EU, which implies that the EU, and even the WEU for that matter, are certainly not perceived to be antagonistic military blocs.⁹³ Those Russians that have heard of the EU know well that the EU is Russia's main investor and for this reason alone, also likely recognize the benefits a continued cooperative relationship can offer. After all, the Russian government is primarily focused on the economic development of the country and the perpetual goal of integrating the country into Europe.

Nevertheless, as the EU's foreign, security, and defense policies develop and as the EU incorporates new members, Russian attitudes could quickly change. Some speculate that Russia favors the evolution of the CFSP because it implies greater European independence from American influence, especially vis-a-vis NATO.⁹⁴ In addition, so long as there is no collective defense mandate attached to the EU, Russia will continue to view expansion of the Union with less hostility than the expansion of NATO. However, if a collective defense agreement is indeed adopted by the EU, the extent to which Union membership has expanded could have serious implications for the strategic relationship with Russia. This is particularly true when considering the membership of two nuclear powers within the EU as well as the deteriorating state of the Russia military. In addition, the Petersberg mandate could cause further friction — but also closer cooperation — between Russia and the EU in the future. Because there is no specific geographic limitation to Petersberg missions, it is conceivable the EU would contemplate undertaking a mission very close to Russia's borders, especially as the enlargement process continues. Current instability in the trans-Caucasus region, for example, has the potential to worsen to the point that the EU may feel compelled to respond. The nature of the EU's response — whether it employs military tools or non-military, civilian instruments — will likewise determine the nature of the Russian response.

The Common Strategy fashioned at Cologne apparently anticipated the possibility of European actions in regions close to Russia. This is evidenced by the EU's pledge to "work with Russia to develop joint foreign policy initiatives with regard to third countries and regions, to conflict prevention and to crisis management especially in the areas adjacent to Russia, on the Balkans and the Middle East."⁹⁵ European leaders also considered the importance of including Russia in their strategic planning when the gathered at the Council Summit in Feira in June 2000. In the context of fashioning the principles and modalities for the EU's relationship with NATO and EU candidates, the Feira Presidency Conclusions suggested that "Russia, Ukraine, and other European States engaged in political dialogue with the Union and other interested States, may be invited to take part in EU-led [crisis management] operations."⁹⁶ No specifics were given, but the French Presidency was invited to make proposals for an arrangement. Such a step would go a long way towards keeping the EU-Russia relationship on a cooperative track, especially as the EU expands closer to Russia borders and at the same time, acquires military strength.

2.5. Transatlantic Relations

The issue of reconciling the development of the EU's CFSP and CESDP with American expectations is proving to be an equally delicate — although definitely more frustrating — process. While treading a rough path towards the establishment of an independent foreign and security policy structure, the EU is trying to reassure allies on the other side of the Atlantic that its intentions are not to disengage. In February 2000, Patten told a joint meeting of the European Parliament Foreign Affairs Committee and members of the NATO Parliamentary Assembly that the EU has no intention of duplicating NATO's role: "The core of NATO's function is collective defense. And nobody, I repeat, NOBODY, is suggesting that this should become part of the EU mandate."⁹⁷ Patten's comments followed a curious statement made by European Commission President Romano Prodi to a group in Latvia less than two weeks earlier. In his speech, Prodi purportedly said that "any attack or aggression against an EU member nation would be an attack or aggression against the whole EU, this is the highest guarantee."⁹⁸ Prodi may have misspoken (or spoke too soon), but given the question of incorporating the WEU and its collective defense mandate into the EU, this kind of security commitment is not out of the question. In fact, the Maastricht Declaration and the Amsterdam Treaty both make reference to the fact that the longer term perspective of the EU's security and defense policy could be to develop a common defense. The Treaty of the European Union explicitly allows for the member states to decide to adopt a common defense if they so choose,⁹⁹ but as a European Parliament resolution on the establishment of a Common European Security and Defense Policy noted, "collective defense at present falls outside the field of the CESDP" (emphasis added).¹⁰⁰ One might easily assume that collective defense eventually will fall within the field of the EU'S security and defense policies. Prodi's premature comments merely point to the fact that a decision on this question will have to be taken eventually. They also point to one of the many issues of contention between the EU and the United States.

The possibility that the EU could one day construct a common defense promises to complicate relations with the United States over the longer term. Even as the EU takes preliminary steps to build its capacity for autonomous action, the American reaction to the plans was, and remains, cautious. Initially, the US position was premised on the conditions that Europe does not challenge the leadership role of the Alliance on European security matters, and that the EU does not acquire a completely separate capacity for action that might weaken NATO. US policy on this issue came to be characterized by the three D's: No De-coupling, meaning that development of a common European security and defense policy should not weaken the Atlantic Alliance; No Discrimination, implying that EU-led crisis management operations should be open to equal participation by all NATO members; and No Duplication, meaning that EU capabilities should not replicate those already in existence within NATO. By November 1999, George Robertson, Secretary General of NATO, tried to soften the criticism and frame the concerns as the three I's: Improvement in European defense capabilities; Inclusiveness for all European allies; and the Indivisibility of transatlantic security.¹⁰¹ One analyst describes the US position as having more recently evolved into a less condemning, more positive sounding "yes, but" attitude. ¹⁰²

It is likely that with a "yes, but" position the Clinton Administration is trying to show that it is not entirely opposed to the development of a more militarily capable Europe. Gradually, the Administration has warmed to the concept, but skepticism about how exactly CFSP will develop remains. Furthermore, certain members of Congress in particular prefer to throw their support behind the European Security and Defense Identity, the concept developed in the context of NATO to allow the Europeans a larger role within the Alliance.¹⁰³ A basic element of ESDI focuses on improving European capabilities, but in the American mindset, the improvements are meant to contribute to the collective assets of NATO, not the EU. Thus, the commonly heard criticism from Washington is that the European members need to spend more for their obligations to NATO rather than waste time and effort building new institutions that could come into direct competition with the Alliance.

The widening differences between the US and Europe is most basically illustrated by the terms employed on either side of the Atlantic. It is often easy to determine who is doing the talking based purely on which acronym is used — despite the fact that the difference amounts to more than just a few letters. For the Americans, the debate revolves around the question of whether ESDI is to remain under the rubric of NATO. For example, one hearing before the US Congress in March 2000 brought out testimony about the future of ESDI, even though the line of questioning from the members of Congress was quite clearly more about the EU's agenda.¹⁰⁴ On the other hand, the focus of discussion in Europe is about how to develop both the CFSP as well as the CESDP, two concepts quite distinct from EDSI. One observer in Washington made this keen observation of the hazards of confusing the acronyms:

"The persistent use of 'ESDI' rather than 'CESDP' [Common European Security and Defense Policy] by US officials could be a subtle transatlantic hint that the way to strengthen European defenses is through NATO rather than the EU. Equally likely, however, the references to ESDI may betray simple ignorance...John Holton of the American Enterprise Institute recently warned that 'it is possible that ESDI has a hidden agenda to project European military power 'out of area' without U.S. involvement.' The true ESDI (under NATO) could hardly do that, for it would be subject to U.S. veto."¹⁰⁵

Acronyms aside, the inconsistencies become more significant when substantive issues about sharing capabilities or decision making are debated. For example, the Helsinki Presidency Conclusions declared that the EU will decide whether or not to launch a crisis management operation¹⁰⁶ "when NATO as a whole is not engaged." But according to Congressman Doug Bereuter, this phrase can be interpreted to mean that the European Council at Helsinki had allowed for a "NATO right of first refusal" before they would make a decision to lead a military operation. No such concession has actually been admitted by the EU and in fact, an early draft of the report on EU/NATO relations by the Portuguese Presidency in the spring of 2000 suggested instead that the EU and NATO would commonly assess a situation and would mutually decide on the best way to conduct an operation. A decision would then come "at a point at which a common understanding would emerge that the Alliance as a whole would not be engaged and that an operation under the political and strategic direction of the EU was envisaged..."¹⁰⁷ Interestingly, no mention of this issue was made at all, in any form, in the final and public version of the Presidency Conclusions released at Feira. Still, US officials persist with their own interpretations. On June 28, Defense Secretary Cohen remarked that, "Yes, there will be decisions that will be made by EU [on crisis management operations], but within the context of situations where NATO decides not to take action." ¹⁰⁸

Not surprisingly, there is significant European resistance to the idea that NATO might reserve a "right of first refusal." Acceptance of such a condition would effectively render EU actions dependent on a prior decision by the North Atlantic Council — hardly the decision-making autonomy Europeans desire. But the US is clearly anxious to engage the European Union in discussions on mutually binding formal agreements (e.g., on the availability of European military capabilities to NATO). Depending on the type of operation the EU chooses to launch, it may have to employ some NATO assets. And given that the European Union will lack the capability to conduct any large scale or high-intensity operations without borrowing some US assets for at least the foreseeable future, the US has been pushing to establish EU-NATO links at as early a stage as possible. In contrast, the European position is to enter negotiations on formalizing relations between the EU and NATO only after the EU structures and capabilities are securely in place.¹⁰⁹ An unnamed US government official remarked in February that:

"The charitable view is that the European Union is not ready [for dialogue] because its new structures — the military and security committees — are not yet in place. The less charitable view is that they are holding us at bay. I think the truth probably falls somewhere in between, because there is a wide diversity of opinion about how to proceed with formalizing relations any links to NATO." ¹¹⁰

Although the European Council implied in the Feira Summit Conclusions that a "permanent" relationship with NATO could be installed by December 2000, it appears that the EU will continue to push back that date until the EU permanent structures are put into place after the Nice European Council in December--or even later. The Feira Conclusions stressed that the arrangements for the relationship between the EU and NATO will reflect the fact that they will deal with each other on an "equal footing" and that the two will be "mutually reinforcing" in crisis management.¹¹¹ Establishing a dialogue on an equal basis will certainly take some time as the EU needs to acquire capabilities that will endow the organization with some credibility. Therefore, one can expect that the informal relationship between the EU and NATO will persist until the EU can improve its negotiating position.

Definition of the relationship with NATO — or rather, with the non-EU members of NATO — promises complications for the EU's plans. On this question, the US is finding convenient allies among the Czech Republic, Hungary, Iceland, Norway, Poland and especially Turkey, all of which are members of NATO but not the EU. These states share the American concern that EU decisions and operations could effectively discriminate against them and weaken transatlantic links with the US. They are worried that even though the EU could theoretically employ NATO assets, they would have no influence on any decisions or actions taken by the EU. The non-EU NATO states have consequently demanded the right to fully participate in the development of the new EU Rapid Reaction Force and to sit on the EU's political and military committees.¹¹²

An early draft of the plans developed by the Portuguese Presidency to develop modalities for the consultation and participation of third countries in EU crisis management operations did very little towards assuaging the concerns of the non-EU NATO members. The language in the draft report was careful to stress the importance of protecting the EU's decision-making autonomy while at the same time agreed that allowances must be made for non-EU NATO members as well as candidates for EU accession to contribute to EU-led crisis management.

But at the WEU Council of Ministers meeting in Porto in May 2000, the Turkish Defense Minister expressed his government's disappointment with the proposals in the draft report by the Portuguese Presidency.¹¹³ He criticized the scheme as one that would reverse the cooperative measures and inclusiveness that have evolved within the WEU over the past ten years. The Defense Minister further noted that Turkey's offers to contribute to the military headline goal had not yet been acknowledged and that there had thus far been no mention made of non-EU European allies contributing to the development of the non-military crisis management capability. Turkey proclaimed that it could only conclude that "the status of the full partnership [which had been] established in the WEU is being downgraded to the status of a 'third country.'" The Turkish official even alluded to the possibility of blocking the EU from using NATO assets: he concluded his speech by referring to the "necessary cooperation with NATO" and stated that "a satisfactory arrangement can contribute positively to the development of the EU's future relations with NATO on the military side." ¹¹⁴

At the same meeting, the Norwegians and the Czechs expressed similar dismay with the proposals, albeit less bluntly. Both suggested that the Portuguese plan should be considered just as the first step towards a process of greater inclusiveness and co-operation.¹¹⁵ Instead, the final report adopted at the Feira Summit appears to have taken this position, given the vague details and the very terms employed (i.e., "principles" and "modalities"). It is probable that the details were deliberately left open-ended because the EU has not yet ironed out all the wrinkles within the CFSP and thus, did not want to determined quite yet how the relationship between the EU, NATO, and other EU candidates countries should be permanently structured.

Still, it appears that the Turkish government remains displeased with the Feira Conclusions. The Conclusions maintain the previous position that had stated that non-EU European NATO countries that contribute "significant military forces" will only have influence over the day-to-day conduct of an operation and not the political or strategic decisions. With this in mind, Turkish concerns may stem from the possibility that the EU could conduct crisis management operations in the Balkans or the Trans-Caucasus, areas of direct strategic interest to Turkey. Consequently, the Turkish government is keen to have its voice heard in the working groups that were designed by the European Council at Feira and tasked to work out the complex issues relevant to the EU-NATO relationship. The working groups have already begun meeting in Brussels and were expected to submit their proposals by September. According to a diplomat close to the talks, "Turkey has taken a very hard stand"¹¹⁶ and is likely to resist any measures that would limit its influence on the EU.

2.6. European Military Capabilities and Defense Spending

At the same time that it will be difficult to satisfactorily resolve the issue of consultation arrangements, additional tensions exist regarding the European desire for autonomous capabilities and the American demand for avoidance of unnecessary duplication. On this question, there seem to be two contradictory concerns emerging from Washington. First, the US seems nervous about the possibility that the Europeans could take up an operation without the participation or even consent of the US. The American insistence that NATO have a "right of first refusal" is characteristic of this position. Conversely, there is a substantial amount of skepticism in the US about the ability of the Europeans to even make their plans work. Critics who adopt this position commonly point to the military capability gaps between the US and Europe that have been cited by the DCI and the WEU Audit. Regardless of the argument, some US officials are terminally pessimistic, warning that if the EU experiment fails, the consequences for NATO could be disastrous. For example, the US Ambassador to NATO, Alexander Vershbow, has claimed that if the EU countries fail to meet their Helsinki goals, it could create a major internal crisis for the Alliance. Vershbow argued that "it could lead to a two-tier alliance in which the Europeans only focus on low-intensity situations such as peacekeeping while leaving NATO to do the dirty work at the high end of the spectrum. That would not be healthy for the transatlantic relationship." ¹¹⁷

To a large degree, the American fixation on the dire consequences centers around defense spending. Stated simply, there is not enough of it. The argument that European defense spending is too low is an old one, but now that the EU is outlining new military missions, the complaints have grown louder. During a visit to Hamburg, Germany in December 1999¹¹⁸, and again at the annual Munich Conference on Security Policy in February 2000¹¹⁹, US Defense Secretary William Cohen exhorted the Germans to correct the disparity in capabilities that was exposed during the Kosovo war. In an op-ed piece for the Washington Post, Cohen accepted that reforms and better investments within the existing budgets of the European allies would help to fill the gap. "But in the final analysis," he concluded, "allies will have to spend more on defense if they are to measure up to NATO's requirements and establish a European Security and Defense Identity that is separable but not separate from NATO." ¹²⁰

In general, the US applies the directives of the DCI to push Europeans to spend more to overcome the credibility and capability gap. In his testimony to the Senate Committee on Foreign Relations, Assistant Secretary of Defense for International Security Affairs Franklin Kramer said that:

"The Allies need to show leadership in making the necessary investments to field a 21^st century force...Yet unresponsive defense budgets continue to erode Alliance capabilities. While Allies acknowledge their capability shortfalls, few have made concrete efforts towards their amelioration by increasing their defense budgets and reallocating funds... To provide the necessary resources to support DCI, nations must re-evaluate the percentage of their GDP devoted to defense spending and will need to consider restructuring existing forces, reallocating within existing defense budgets, and increasing defense spending." ¹²¹

Considering the EU's multiple commitments to build autonomous crisis management capabilities, to rectify the deficiencies identified by the WEU Audit, and to improve its security contribution to NATO according to the Defense Capabilities Initiative, some leaders in Europe admit that increased defense spending will be necessary. It should come as no surprise that defense ministers and generals would push for greater spending, or even that HR/SG Javier Solana, also the former Secretary General of NATO, admitted in discussions about plans to create the EU Rapid Reaction Force that "in the short and medium term [EU member states] will have to increase defense budgets."¹²² But other politicians would also like to reverse the direction of falling defense budgets. The French Ambassador to the US claims that "the present unsatisfactory state of defense budgets within NATO" can be corrected if European citizens understand the mission better and if the imperative is made clear.¹²³ Nevertheless, more money for the military is unlikely to appear in the near future given the high level of unemployment in many European countries, tight budgetary constraints, and the fact that most Europeans do not perceive a looming military threat that might legitimate higher spending.

2.7. Developing and Unifying European Assets

But there is general acceptance among European governments that the military strength exhibited during the Kosovo war is insufficient for the establishment of autonomous capabilities.¹²⁴ The comparison has been cited many times before: while Europeans collectively spend 60% of what the US does on defense, they do not get anything close to 60% of US capabilities. In order to fill that gap, EU governments have endorsed the findings of the WEU Audit and the DCI, which means that they will have to acquire costly systems such as command and control structures, satellite communications, and strategic transport. But larger defense budgets are clearly not a feasible remedy and may not even solve the problem. Instead, Europeans are exploring alternative strategies such as greater efficiency in spending, reforming force structures, establishing unified and coherent procurement policies within Europe, and restructuring and consolidating European defense industries. It is a mission fraught with sensitive and complicated issues, not the least of which involve issues of sovereignty, coordinated national export controls, and protection of classified information.

In the framing of a common defense policy, Article 17 of the Treaty of the European Union allows for the Member States to cooperate in the field of armaments. But Article 296 exempts defense industries from the EU laws that regulate competition in other sectors of the common marketplace.¹²⁵ This means that EU countries can enact measures that will protect their domestic defense companies from external competition. In addition to this, procurement is undertaken on a national basis, from national defense budgets. As a result, fragmented procurement polices, redundant research and development (R&D) programs, and widely varying export control standards contribute to an overall level of inefficiency, which ultimately makes it difficult for European defense companies to compete with American products.

Alberto Zignani, Italy's National Armaments Director, has warned that unless Europe coordinates its defense acquisitions, American defense companies will continue to dominate the European market and will eventually push European companies out of business.¹²⁶ A report by the Bertelsmann Foundation in Germany also pointed out that "the very attempts by European governments to protect their indigenous industries through preventing the adoption of a single European market in defense has increased the threat of European companies becoming sub-contractors to the American giants."¹²⁷ Because of the large US defense budget and because the US government is able to fund large acquisition packages, it is able to support longer production runs and achieve an economy of scale that would be otherwise impossible in Europe. The adverse result of the disjointed acquisition practices in Europe means that it is even more difficult for European governments and industries to cope with the rising costs of so-called "smart" and "brilliant" weapons technology and thus, are unable to compete with American companies that are able to offer cheaper and more cost efficient products for export. When all of these elements are added together, it is ultimately more expensive to fill in the defense capabilities gap.

The survival and security of domestic defense industries have always been closely bound to the integrity of national sovereignty. This is no less true today even for the EU, an institution which is itself essentially an agglomeration of national sovereignty. Therefore, if the EU is to develop a common security and defense policy, one that is meant to promote the political status of the EU and provide for improved autonomous military capabilities, the maintenance of a strong and secure European armaments market and only limited dependence on the US for defense needs seems logically necessary. In order to accomplish this, and in order to compete not just in Europe, but internationally as well, the dialogue in Europe today is focusing on restructuring and rationalizing defense industries. Trans-national mergers are only one phase. The more difficult elements in the evolution of a common European weapons market (and therefore, mutual dependency) will require governments to harmonize export controls, procurement decisions, as well as research and development strategies. The first steps in this direction were recently taken when the six major arms producing powers (France, Germany, Italy, Spain, Sweden, and the UK) hammered out a "Framework Agreement" that calls for common export procedures, simplified technology and classified information transfers, and coordinated research and development.¹²⁸

Although those in the European defense industry have heralded it as an important step forward, opposition to this agreement and others like it is already gaining momentum. Some non-governmental organizations in Europe are complaining that the "creeping harmonization" of arms export controls in the EU could risk diluting some member states' more restrictive export control criteria and reducing the standards to the lowest common denominator. This could, in turn, make weapons technology leakage to undesirable destinations more likely.¹²⁹ In addition, the "White Lists" referred to in the Framework, which identify states that are eligible to receive weapons exports from the six, will not be made public for confidentiality reasons. According to critics, this practice contradicts the EU's Code of Conduct on the arms trade, which specifically aims to promote "greater transparency." ¹³⁰

Coordinated acquisitions and national specialization are other suggestions being made toward the goal of establishing a single European armaments market. The idea is that by unifying demand, better cost efficiency can be achieved, and expensive items, such a precision guided munitions, can be acquired at a more manageable cost. The Organization for Joint Armament Cooperation (OCCAR) is one of a few attempts at coordinating procurement within Europe. OCCAR was initially formed in 1996 by France and Germany, and was then later joined by the UK and Italy. In September of 1998, the four countries signed a treaty to make OCCAR a legal entity, empowered to develop procurement procedures, contracts, and regulations.¹³¹ To date, OCCAR has managed only a few projects, but the hope is that with time, it will acquire enough experience to be able to ease the development of a European Armaments Agency.

Exploitation of commercial or civilian sector products are also viable options for cost savings in procurement. US Assistant Secretary of Defense Franklin Kramer suggested that the Europeans could fill many of their logistics and communications requirements by purchasing commercial or "off-the-shelf" technology. He suggested that this could be particularly efficient in the area of global positioning systems (GPS), satellite communications and imagery, and that "increased leveraging of commercial logistics and mobility assets holds opportunities for greatly improved capabilities without large spending increases." ¹³²

It is still uncertain whether the US will be satisfied that the Europeans are moving to fulfill the directives of the DCI. Each EU state has agreed that in order to meet the headline goals outlined at Helsinki, investments must be made in strategic lift capabilities, tactical mobility, integrated command and control systems, intelligence and logistical support. But the areas in which the US also believes the European must focus their efforts require the acquisition of extremely expensive items, such as precision guided munitions. In at least the short term, the costs associated with restructuring national armed forces to meet the Helsinki headline goals and to be able to handle the Petersberg Tasks will likely override American insistence that the Europeans purchase this kind of advanced weaponry. Besides, such high technology would have comparatively little value for the types of missions the EU expects to focus its efforts on. By the time of the Capabilities Conference or even later, as the EU works toward developing its own capabilities, it is conceivable that the EU could devise for itself something along the lines of a "European Capabilities Initiative." A home-grown initiative of this type could offer a more tailored approach to meet EU goals.

Apparent efforts on the part of European governments to bolster European defense firms in the context of a cooperative armaments plan are already becoming a source of dispute with the US. For example, the US recently complained that the German government yielded to "political-industrial pressure" to grant a $240 million contract for the purchase of helicopter engines to European defense companies instead of a consortium that included an American firm.¹³³ It seems only natural, though, that cooperation within the EU on weapons requirements will entail an inclination to "buy European", especially in order to improve the health of local defense industries that are finding it difficult to compete against US companies. Indeed, the same day the Framework Agreement on Export Controls was signed, the governments of Britain, Belgium, France, Germany, Italy, Spain and Turkey also announced their decision to buy 225 Airbus A400M transport aircraft — instead of planes offered by the United States or by a Russian-Ukrainian consortium. British Defense Minister Geoffrey Hoon heralded the group purchase by declaring that the acquisition "underlines our shared commitment to supporting the European defense industry." ¹³⁴

Beyond the question of procurement and revitalizing European defense firms, EU governments will have to resolve the problem of establishing a sufficient level of interoperability and standardization in order to supply the forces that will undertake military crisis management operations. The force generation conference slated to be held in November 2000 is to determine exactly what assets will be available to support the Rapid Reaction Force and make it operational by 2003. However, given the complicated nature of even the few questions mentioned above, there is already some serious doubt among observers that the EU can meet the 2003 deadline. At a gathering of defense ministers and generals in Brussels in late March, retired German General Klaus Naumann frankly remarked that he did not believe the EU would be able to build the Rapid Reaction Force by 2003. NATO Secretary General George Robertson echoed the sentiment and advised European leaders to "exercise rhetorical discipline" on the issue.¹³⁵

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