Eastern Frontline
The Eastern Frontline podcast is hosted in the European Parliament by the Eastern Frontline Group (EFG), an alliance of 43 MEPs from 13 EU countries. Each episode, policymakers and experts discuss Europe’s most urgent security challenges, as well as the social, psychological, and human dimensions of resilience. .The podcast is produced in partnership with The Parliament Magazine.
Eastern Frontline
More Money, Less Impact? Europe’s Defence Spending Problem
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Europe is increasing defence spending at an unprecedented pace. But is it making Europe more secure?
In this episode oft the Eastern Frontline Group's podcast, Latvian MEP Reinis Pozņaks and Dutch MEP Reinier van Lanschot are joined by economist Guntram Wolff to examine the economics behind Europe’s defence push.
They explore the key question at the heart of the debate: is defence spending truly an investment, or simply government expenditure with limited long-term returns?
The conversation looks at how Europe is spending its money, why a significant share still flows to non-European suppliers, and what that means for both security and economic growth.
It also examines the structural challenges facing Europe’s defence market, from fragmentation and lack of competition, to the difficulty of integrating small innovative firms into procurement systems.
They discuss:
- why higher spending does not automatically mean greater security
- the case for a more integrated European defence market
- how competition can reduce costs and increase production
- the role of startups and innovation in modern defence
- and whether Europe needs to rethink its approach to defence as part of a broader economic strategy
At a time of rising geopolitical pressure, the episode asks a fundamental question: how can Europe spend better, not just spend more?
Yeah, so hello everybody, welcome to the next episode of our Eastern Frontline Group podcast. And today here with me is uh my colleague Rainer van Lanshot, right? Yes, yes, from Netherlands, from Walt and Greens group. My name is Rainis Posniaks. I am from Latvia and and ECR group. And our distinguished guest uh Guntram Wolf, the professor, but your credit is so long that maybe you can introduce yourself.
SPEAKER_01Oh, okay. So I'm I'm Guntram, and I'm a professor of economics at the University here in Brussels, University Libre de Bruxelles, and uh a senior fellow at Bruegel.
SPEAKER_02Yeah, as as uh probably already understood, we will talk about the uh defense and economy this time. So I start with a simple question. Uh, considering that a lot of money is going into the defense in Europe now, how would you prefer to call it defense spendings or defense investments?
SPEAKER_01Well, it is an investment into our security, but it is from a macroeconomic point of view, it is first and foremost spending. So it is spending that uh is um uh contributing to economic development in the short term by providing some economic stimulus, but um, it is not really having uh long-term growth effects unless we really refocus our spending on the high-tech and the modern uh equipment. So a lot of the spending, I mean, I investigated in quite detail on what we are basically spending, what kind of defense spending are we doing. We published that in a Kiel military procurement tracker, and what you can see is that um the more um the uh spending is high-tech spending, um, the more um it is actually spending that goes to US American firms. And um, that I think uh is uh is a double liability, a double problem. On the one hand, it is a problem because uh it uh reinforces a security dependence that can be exploited if political uh relations become become even worse than they are. Um, and it is also a liability in the sense that we don't reap the gross benefits. And your question was, is it an investment? So if you spend on high-tech goods, military goods, there is now a significant economic literature that shows this has long-term positive growth effects because these technologies, technologies, are beneficial way beyond um military, narrow military purposes.
SPEAKER_00And I uh would call it uh if you look at it from a societal perspective, investments, because uh, in the end, um we all benefit from uh security, and the downsides that we protect by investing in our defense um is is is huge. So we prevent disasters from happening by investing in defense, at least that's what we're aiming for. Um in order to achieve that, we need to speak up speed up though. When it when we look at it from a purely economic perspective, and as a member of the European Parliament, besides working on defense, I also work on the internal market. If we look at it from that perspective, then I fully uh agree with Guntham that um this is more spending than investments. But when I talk about it publicly, I choose uh investments more often over uh spending because um uh we need to uh also uh make sure that people share the the desire and the necessity of this. And then talking about investments can be more convincing. Um what I sometimes see happening is uh when we talk about defense uh spending or investments, that people um uh look at okay, every euro we spend on defense we're not spending on healthcare uh or we're not spending on education. And of course, I want to spend money on healthcare and education before spending it on defense, but the need is so high that currently we need to make that uh make those decisions to invest in defense. However, if we do it smartly, then it doesn't have to be an either-or question. And what do I mean with smartly? I mean collectively, in a real European way. That could save us 100 billion euros. Thirty percent of all defense spending would become cheaper because we just get more bang for our buck if we uh collectively buy things. And that unfortunately is not happening to the degree that it should be happening, and it makes us uh uh weaker and poorer. So as a member of the European Parliament, I'm pushing for that collective buying and also collectively producing.
SPEAKER_02Okay, but but what Europe can do to like uh replace the American spending to America, are we doing enough or are we doing it at all?
SPEAKER_01Well, I mean, I would I would agree that a lot of the spending that we are undertaking is actually spending that is not very efficient, right? I mean, so we are spending uh I mean we have I would say uh a triple problem. I mean, first of all, we're spending a lot of stuff, or a lot on stuff that um has been shown uh now by the Ukrainians and by the way, also by Iran, to be relatively um uh useless or at least not as effective as it is claimed to be. So one really big challenge is the modernization of our armed forces. And I have to say they are really moving relatively conservatively and rapidly. I think the second big problem is, and and you hinted at it, is we we spend in a very fragmented market. Now, do we need to procure everything together? Well, I think that's one idea. I think even more important is just to open up borders and make sure that we buy in a single market instead of just buying with your national champion. And let me give you a prominent example. The German Court of Auditors um has just um realized in December that uh Germany spent 21 billion, uh procured for 21 billion military clothing, um uh 600,000, 700,000 sets, which makes each set really super expensive, uh, around 30,000 euros, which is a crazy amount of money. This money went without a public tender uh to um the domestic national champion. So imagine you would spend this in an integrated market, you would have a public tender and you would find all firms in the in the EU to compete for this. The the savings would be massive.
SPEAKER_00So exactly, exactly. I even heard that the same is true for France, that even the French uh um underwear of uh the soldiers needs to be procured in France. And it's that nationalistic thinking that uh is uh uh not smart in this 21st century uh with this geopolitical environment.
SPEAKER_01Yeah, and I mean I just want to add one last point, which is I I think the um we need to make sure that we do not just procure from the big firms but also open up and bring in innovative new firms. Now that's a that's a problem that many armies face. The US has faced it, the Israelis have faced it, the Ukrainians have faced it, and they are all those three countries, they actually enacted very significant reforms to explicitly allow these small startups to enter into the procurement. And that's what you need because it's these companies that typically also bring um the new disruptive innovation, robotics, AI, drone warfare, uh hypersonic missiles, you name it. I mean, this is coming not from many of the big established players, but often from new uh new entrants.
SPEAKER_02Yeah, that was exactly what one Israelis like one of defense giants, and Israelis defense industry is like one of the like leading ones. And what they told me is that after October 7th, what they realized that they always lived with the idea that they have all the best technologies, like but then like when the this war started, like it showed up, especially first days, that there's a lot of solutions in in civil civil world, which is like much more effective. Very like simple example, but basically the army, and the same was in Ukraine, was commanded first days through the WhatsApp. So and basically the the commanding now is moving to the mobile phones again. And and and they realized how how are they managing that they are not trying to like uh buy the startups, but just uh like serve as a as an app store or Google store for the for the small companies because they say that what they realize that the the best innovations comes from the small companies, but what they can provide is like production capacity if needed and and all that kind of infrastructure. And that's uh that's the way how they are rebuilding like their the whole industry. Like, is something going on in Europe like that, or are we still still old school?
SPEAKER_00I would say not to the to the degree that I think is needed. Um, so what we've talked about in the European Parliament quite a bit is uh European version of DARPA. DARPA is the American uh um institution that uh is there to support uh innovator innovators in the military field. And I when I talked to DARPA, what I learned is the way they approach uh innovation and uh uh have a uh very short timelines, uh high risk appetite, enough funding behind it, and that enables them to really experiment and then when something works, scale that up. And that's why I think a European DARPA should be created to fulfill part of that uh need that you just described. The other thing, whether it's uh uh talking to uh a Dutch uh SME who uh is a supplier in defense uh related equipment or a Dutch startup on this front, is that I hear what they the desire is contracts, long-term contracts, because then they can actually produce. So um a lot of startups, because it's now in the attention of many people, they do get VC funding, they do find investments, but then there can be a gap in uh their cash flow if they don't have uh uh long-term contracts and commitments, and then um they can uh uh get into uh problems because of it. And what really worries me is that I hear that actually the increased capacity in production is not happening yet. And I'm like, what? We're for more than four years into the war in Ukraine and our production production capacity is not increasing. Then and I talk to these companies and say, Oh, do you have trouble finding new people to deal with the new demand? And then they are they answer with, Well, the new demand is not there yet. And and and that really shows that our uh uh ministries of defense on a national level are still too slow, uh too bureaucratic, and too much stuck in in uh peacetime thinking. Um and there I think we as politicians have a role to play to to push through it and make sure that we increase our capacity more quickly.
SPEAKER_01Well, I mean, I I I I broadly agree, perhaps just to add, I mean, the procurement numbers um have gone up, of course, a lot, and in particular, Germany is now leading uh procurement in in Europe by a large margin. So the numbers um of German procurement in 25 compared to uh compare uh basically to the rest of NATO Europe. I mean, so so Germany ordering as much as the rest of Europe together. So these are these are very significant numbers. We're talking here of 60 billion, 80 billion um that is being procured. So by now the numbers are coming in in at least in Germany. The problem, however, being um that a lot is um is targeted towards um the established domestic industrial defense industrial base. And you know, if you are a national champion um and you know that your government will order from you, um, of course you have an incentive to uh charge a very high price, and you actually don't have an incentive to innovate and bring down prices or to invest into capacity at an early stage. So part of the reason why the production has also not yet come up as much as it could have is a lack of competition in this market, which is a result of fragmentation. And I give you a very concrete example where you can see the positive effect of competition. If you look at the production of 155 millimeter artillery shells, so which is more or less standardized across Europe. I mean, there's still some differences, but it is at least it's one sort of millimeter size. There, we have several companies and several countries producing, and we have Ukraine, we have the Czech initiative, we have many national armies all buying the same stuff. So it's more or less like a real market. And in this market, we have seen a massive increase in production capacity. Europe is now outproducing the United States in these shells. Um, and actually the cost per shell has fallen by more than 50%, so it's half as expensive as it used to be only two years ago. So this is very significant changes and it's and I think it's the result of competition, right? I mean, you need competition, and for that you need a more integrated defense market.
SPEAKER_00Yeah, totally. And what I'm sometimes sometimes missing in uh this conversation is that we talk a lot about the amount of money we're spending, but we are not talking enough about what we are spending it on. And um, if you ask me, the primary aim should be uh first supporting Ukraine because it's morally right and it's in our own security interest. Then the second aim should be to ensure that Europe can defend itself autonomously. I hope we will remain uh uh collaborating with the United States, but uh with the way the Trump administration is behaving, it is almost impossible, and it is a likely scenario that we will have to defend ourselves by ourselves, and even in some scenarios, the US could be an adversary. So in that sense, we need to speed up our ability to defend ourselves. And then it that uh comes back to the question what do we spend it on? And then we need some European strategic enablers, we need more European satellites, for example. Often these bigger systems that we're now reliant on the US uh for, but that uh um each individual European country uh cannot supply themselves, and therefore more collaboration on that front is necessary. A good example is a uh multi uh uh transport, uh multinational transport and air refueling capacity, which is based in Eindhoven, the Netherlands, where 13 different countries have decided okay, well, we cannot really uh um we need this capacity, but we cannot do it ourselves. Let's collaborate. This started back in in 2013, I think, an initiative, and now there's a German commander, there's uh uh Dutch pilots, French pilots, they are working together. And and I think that can serve as an example for other strategic capabilities that we need to procure together. And I hope that's the conversation we can have more.
SPEAKER_02Yeah, I I I fully agree on that. That's uh like just say that we are spending more money, it's it's it's it's good, but the most important is how you spend it and also on what you spend it. And I think one of the key is uh production capacity, which you already mentioned, because there was, I think, the the the data from Bloomberg again that European defense industry is like in in the last couple of years that like turnover increased by 56%, but production just by 16. So basically, yeah, but what we got not more weapons, but more expensive weapons.
SPEAKER_00Yes. And Kubelius also mentioned that this is a real risk that all we're doing is inflating, and then we make uh the shareholders of big uh uh big uh uh military companies richer, but we don't actually get more security.
SPEAKER_02But there is actually a bit other issue that, for example, and I know one company who gets, I think it was from Germany, order from missiles, and they need to produce thousand missiles, and they would like to like get the small medium companies to get involved in the supply chain, like because they need to produce them done quickly. But it's very difficult to get them in because when you st if you produce bolts for the table, it's okay. But if you produce produce the bolts for the missile, you become a like a military company, which makes your life in in many ways much more difficult. Banks don't like it or start to look at you differently. So and basically there is not a big will to become a part of of defense industry, even like partly or or or timely, and and that is also a big issue in in Europe.
SPEAKER_00It is, and uh I think what is uh um worrying is that we have a lot of national leaders that express the political wish to collaborate more on the defense industry, for example. But then the political will that needs to follow from that wish is absent because the political will comes with a bill, and that bill is sometimes monetary, sometimes it's uh giving up a little bit of your sovereignty to get more European sovereignty in return. Um, but there there are three pieces of legislation that I'm working on at the moment. Uh, one is on um shortening the um uh procedure for getting a permit for something that is related to defense, another one is making it easier to move military equipment across Europe, and um uh these two are another one, but the the legislation that I'm working on, what I notice there is we're going way too slow. Yeah, we're going way too slow, and there's oppositions from the countries whose leaders publicly express the will to uh or the wish to to collaborate more on it, and that is concerning because it decreases our ability to defend itself and we have to speed up.
SPEAKER_01So so can I can I, since I have the privilege of being in a room with two MEPs now, I mean, sort of just just push you and ask you a bit about the more political dimension. Um, because I think you mentioned already sort of uh a joint battle group um for for the armed um for the uh the the fight uh the um the transport and fueling uh aircraft and so on. Um how do you see this going forward? I mean, of course, the biggest efficiency gains we would have in theory is by replacing national armies with a European uh single army under a single command and control structure. And what I find quite interesting is that um when you look at surveys among citizens, um, they usually like this idea, right? I mean, they are very much um, I mean, you have uh in the surveys, you have typically 60, 70 percent of the citizens um across Europe actually, uh, saying, yes, that would be a great idea. Um, and even people in my experience, even people that are quite European skeptic in general, um, in this question, they would say, yes, that would be a good initiative by the EU instead of regulating our paper, straw, uh, straw uh uh uh paper bags or whatever. Um so uh so uh I mean is this is this something where you see conceivably any chance of moving, perhaps uh perhaps coalition of the billing, perhaps uh specific initiatives. I mean, where uh how do you see that play out? I mean, I think especially the command and control structure is really quite central at a moment where the US leadership, I mean, is at the moment it's still the US leadership that does the command, right? The Sakur does the command and control at the moment. Um, the US general, the more this gets politicized, the more difficult it will be. So we have to think very concretely about it.
SPEAKER_00Yeah. I have uh some ideas, but I would love to hear you first.
SPEAKER_02I know that you are a pro-European army, but um I would love to hear you first. Yeah, it's it's I I think it's a bit, you know, um question sometimes of terminology. Because when we understand like army, it it means command and control. Like and um I know that in in uh in border countries, I think there is they're very skeptical about the the like European army, right? Because some general in France will sit and decide like where we start to protect Europe from dog opils, border city, or from Suwaki Corridor, or like you basically give the the the your decision to fight for your country to some somewhere away. But I think what we should do basically overtake NATO. That's what Europe uh should do. Um uh and yeah, take the leading role because basically all the mechanisms are already there and and and already trained and developed, and and we just need to like yeah, basically overtake the the the command and control of of NATO, or at least at least increase significantly the European part in it. And inside the NATO, it's also possible to create like coalitions different, like EU NATO uh part. So that's I think the the direction we we we need need to move because I can say I think in Latvia we've very Difficult to convince the society that we need like European army, like in full understanding what one army means.
SPEAKER_00Yeah. And and so uh for me, um, as a member of Vault European movement, active in all EU member states, uh, we were founded in 2017, and since then we've been advocating for a European army, and uh people laughed at us and I mean called us naive, still sometimes do, but uh uh every time I brought up a European army in debates, people would say I was uh naive. Right. And now we're in 2026, and I think the only naive thing is not seriously considering this option. Um so we've seen some massive changes. Firstly, as you stated, in the uh uh opinion polls, what Europeans uh feel and want, they want a European army. For the first time last week, one of the European heads of state has really publicly called for a European army, the Prime Minister of Spain, Mr. Sanchez. Um, so I definitely see people moving into the direction of uh uh uh integrated armed forces. Um and um uh if you think about it, five years ago there was uh zero defense spending coming from Europe because the EU had no uh uh um decision-making power on defense whatsoever, didn't even have a defense commissioner, and didn't even have a defense a full defense committee. And now we're spending uh 20 billion or so uh with the uh European defense industrial program. We have a full defense commit committee, we have a defense commissioner who also stated that he wants to create uh uh a European army of 100,000 troops to start with. And just conceptually, it is very logical. If if the US had 50 uh different uh armies, then they would not be uh the military power they are today. The uh uh um the essence now is how do we make this practically work? And I see that we need to run a marathon, but our leaders are stumbling on the first steps. So in in practice, it is not materializing yet. So, what what I'm trying to do now is to, together, for example, with Renis, who may have a different view on the outcome of the European army and how far it should go, to make sure that we take these first steps. And that is Europeanizing NATO. Sometimes I hear people that are afraid of that because they say, Oh, we created duplication and we should not duplicate. Boy, ho, we're duplicating 27 times now, and that and so uh uh that's the the the first uh path to walk.
SPEAKER_01So I I I mean I would um I mean I sort of I think on the vision side I'm with you. I think on the practical side I'm with you where we are where we stand, right? But I mean I think one very concrete thing that I would be pushing um at and I am pushing at this point is um working on the satellite infrastructure. Because I mean, there we have European, we have European experience. I mean, the Galileo satellites are European satellites, they are owned by the European Union, they are controlled by two control centers, one in Italy, one in Germany. So there is uh, I mean, lots of checks and balances in there. Now, suppose we do the same thing with communication or spy satellites. I mean, we by the way, we have already a center which is called SATSEN Close to Madrid, which does open source uh satellite-based intelligence for military services, um, and providing that information to all the militaries across Europe. I mean, in a sense, that's already some sort of a military part of the EU, if you wish, right? And so I would I would really emphasize let's build and let's do a fund. I mean, let's fund all these satellites together that would spread the burden across 450 million and not just across uh small countries. Uh let's use the intelligence together and let's let's have these satellites actually under EU control. I think that would be very concrete and um make it bulletproof, make it sure that it's not just in one country, the control center, so that sort of a crazy government could switch it off. I mean, that can always happen. So make it in several countries. I mean, there can be options, really, safeguards, but I think it would be a very concrete step on something where we are really lagging far behind Russia, right? I mean, our satellite infrastructure is quite bad compared to Russia's, actually.
SPEAKER_00That's that's a great suggestion. And you mentioned so one of the safeguards for this could be the spreading uh uh the headquarters in in three or four places in Europe. What other things are important in your view to keep in mind if you want to make this happen?
SPEAKER_01Well, I mean, I I think the beauty of funding it at the European level would be um to spread the cost across Europe, and if it's if it's owned by the European Union, it doesn't appear in the debt to uh debt debt statistics of the member states, right? And um and I think that helps a lot for many countries. And you could um um, by the way, make sure that every country remains, and and here I'm German and you're Dutch. I mean, I'm very committed to um making sure that there's no moral hazard, so someone pays um and then nobody wants to pay um afterwards the interest rate, the interest payments for for the debt incurred for the satellites. Well, here you can make sure that actually there is a mechanism. If you don't pay um your service fee for the satellite, you will not get access to the information. So it would be something where we can create European debt, which is a positive, but make sure that everybody is actually committed and has to pay unless um uh or or lose access to the satellite.
SPEAKER_00Uh-huh. That's an interesting mechanism that I didn't knew before. Thanks for sharing.
SPEAKER_02Yeah, it's good. But I'd like to ask the we we quite often we hear the like saying that war economy, maybe war economy, what that means in practical war economy. What is it?
SPEAKER_01Well, I mean, I I I I I think this term is is a term that is a little bit, I mean, uh, undefined, and uh different people have different views on it. I mean, for sure, uh Ukraine is in a war economy, right? I mean, the the Ukrainian economy collapsed, and now um the but the bulk of uh Ukrainian uh production and activity, economic activity is geared towards uh fighting this war. Russia is also in many levels in a war economy, spending uh massive amounts of resources on the military and on military production. Now, Europe is not in a war economy. I mean, Europe has increased its spending on defense, but we have not, and I think rightly so, not let the government sort of directly intervene in the economy and tell um, I don't know, tell um Volkswagen um to um build instead of cars, now build exactly that kind of military gear.
SPEAKER_02I mean that's the Volkswagen itself wants to do it.
SPEAKER_01Exactly, but that's uh that's a sort of uh a market decision, right? It's a decision of the management, and that's for uh for other companies as well. So so my view here is as long as um we are not in a full-blown outright war, um, the best way of managing it is to basically increase defense spending and then let's market forces come to an optimal solution and you know provide the optimal uh uh uh sort of number of goods and then ensure competition, integrate the market, but that's not a war economy. It's an economy where the defense sector is larger than it used to be um in the in the peace dividend period. By the way, it's still smaller than during the Cold War, right? I mean, in the Cold War we were spending above 3% um um uh in Europe on on defense, three and a half. Now we are just above two percent. So I mean we are far away from uh from a war economy, and and uh thanks God in many respects.
SPEAKER_00I mean yeah, and also I think that the the government uh if you look at history has a tendency to also uh be bad at picking winners, which in a war economy where it would be more directed from uh above uh um could could happen as well. So um I think it is uh uh the best way to make sure that the the market uh uh functioning as a market should optimally function as um uh creates the innovation and the the new technologies that we need. But um what I'm uh also seeing is that the um defense sector doesn't really function like a normal market, um and therefore um especially in uh the countries where it has not really been privatized, I think in the Nordics, in the Netherlands, there's a more privatized defense sector. But in, for example, France, where the big players are partly state-owned, um there there is no real competition. And so then the market doesn't really function. And if you look at it from a from a war economy perspective, I think we I would not advocate for being in a in a war economy in in the EU at the moment, like it is in Ukraine. But I also think we're too far from that at the moment. I remember the first weeks when I entered parliament, I was talking to somebody from the European Investment Bank, and they were still not allowed to invest in defense-related matters. And then I thought I thought to myself, what? Did the war in Ukraine start three weeks ago or three years ago? There's even banks now that uh impose on themselves the rules to not be able to invest in defense. It's not imposed from the EU, it's the bank that banks that do it themselves. And I think that is uh a big mistake. So when when I entered parliament, I thought, okay, my my main uh uh thing here is creating urgency. So I held this speech and I said, like, wake up, everybody, we need to get moving now. But then um Trump got re-elected, he portrayed Zelensky in the White House, and the urgency was felt by more people. And then, of course, with the threats to Greenland and stuff, the urgency is now felt. Uh, but it doesn't translate yet into the tangible, concrete changes that we need.
SPEAKER_02But I have yeah, again, one one one question. When when we talk about defense capabilities like and and the war, yes, it's it's not always just the weapons. And and the the basically when the war starts and you need to produce like many things and quickly, every welding machine or every soldering iron becomes uh your defense capability. And and that means basically that um industry, like any industry which produces anything is your defense capability. So and what is situation uh like in Europe? Will we able to in total like but but if the war starts enough like to turn or we do we have enough industries to to like yeah it's not well I mean I I think um if there was to be a real war um on an EU country, right?
SPEAKER_01I mean not Ukraine but really an EU country and a major EU country, um of course resources would be mobilized in a very different way than than currently. And um uh I think all the I mean there's legislation that is put in place or exists already that allows the governments to uh do far-reaching interventions into the private sector, and exactly what you just described can then be done. I mean, the German government, for example, would have the authority in case of uh a declaration of war by the by the German parliament uh to directly intervene and uh essentially tell the welding machine company uh now you have to the first uh uh 200 days of the year or whatever you have to produce um just for this exact purpose. I mean, so this is possible. Um, but again, I I think we should be mindful of these kind of very strong state interventions um and do them uh really as a as a last resort whenever possible, because it is really um not efficient, right? I mean the government is not gonna be efficient in this. I mean, the government uh if if the country is about to sort of collapse, at that point the government has to do it to defend the country, right? Um but uh before that, um I'm I'm very convinced that um you should do it by increasing defense spending, growing the sector. Yes, there is the issue of state ownership in in countries like France and the control of specific defense companies, and that is already partly a reflection of the fact that the defense industry is special and the government wants to have direct control of defense companies. But for that's one step. But the next step is to say, okay, but now me as a government, I go into Renault, I go into every individual company in the country and I tell them exactly what to produce for military purposes. I think that's something we should shy away as long as possible.
SPEAKER_02Yeah, for sure. I'm I'm just was asking this, but if we need, do we have this welding? Well, but we have we have.
SPEAKER_01I mean, I think Europe has a lot of industry still. I'm so and and I I think the one area where I'm most worried about is not the industry. So I'm more worried about uh the the high-end uh uh digital technology um uh level, where we have a very big dependency um and reliance on on US capabilities, basically. And so I think that's the real I mean Ukraine stays in the fight um thanks to uh services provided by Starlink, uh by Google, cloud services, etc. etc. So I think there we have really big gaps.
SPEAKER_00And to add, I know it paints a little bit of a little bit of a big picture, but um and energy as well. Um so the current industry struggles with the high energy prices, and our dependency uh on energy is uh too high. So uh invest heavily in renewables, decrease our dependency, and try to drive energy prices down will also help us be ready if that uh situation ever occurs.
SPEAKER_02But there is also a trap because we uh with this green energy, uh we have uh China. Uh and and this is a thing we we have to uh be careful. We have example, as you remember, with communications. We have this five 5G toolbox, how you can protect like communications from uh uh from uh bad people, uh but uh we don't have the same yet in the energy sector, and the energy sector is complaining now that it's very difficult to uh to like compete with China, uh, but it's not about the competition, it's a critical infrastructure. And and if you give a control and we don't know, like like like it was with Huawei 5G, that turns out that they have like uh different things involved. Yeah. So thank you all. I think we could keep talking and talking because I have a lot of things. Can I say one final thing?
SPEAKER_00Because we painted a bit of a pessimistic picture, I realize, but the name of this podcast is stronger together, and if we collaborate in the right way, then I really believe we can prevent more war from happening and support Ukraine enough to make them win and create a safer world.
SPEAKER_02Exactly. Thank you.
SPEAKER_00Thank you.