EU Seeks More Bang for the Buck in Military Spending (excerpt)
(Source: Wall Street Journal; published Feb. 1, 2018)
By Laurence Norman
BRUSSELS --- The Italian navy’s newest ship is under attack—not from enemy forces but from European officials.

In 2015 Rome awarded two Italian companies a €1.1 billion ($1.37 billion) contract for the vessel, which can launch amphibious operations and ferry troops. Now the European Union is blasting the deal and several others as anticompetitive and potentially in breach of EU rules.

The EU’s executive, the European Commission, said last month it was preparing legal action against Italy and four other member states—the Netherlands, Denmark, Poland and Portugal—over defense contracts. None of the five countries targeted by the commission commented on the EU decision.

The EU’s assault on the cozy world of European defense contracting opens a new front in the bloc’s battle to get more bang from its military spending and blunt U.S. criticism. The Trump administration has amped up longstanding pressure from Washington for Europe to shoulder more of its defense burden.

The countries now have two months to reply to the commission’s concerns. The deals have a total value of more than €6 billion, according to a person familiar with the case.

If found noncompliant by the EU, contracts could be voided. Some diplomats in Brussels believe the commission is more interested in pledges of future defense-contract competition than voiding signed contracts. (end of excerpt)

Click here for the full story, on the Wall Street Journal website.


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