The Spectrum of Strategic Autonomy in EU Defence Supply Chains

The Strategic Compass aims to strengthen the resilience of defence-industrial supply chains and complements the long-term strategic ambition of enhancing the EDTIB. Impetus for restructuring the EU’s supply chains may be provided by the 2022 Russian invasion of Ukraine, the associated increase in defence budgets, and the promotion of joint projects and cross-border M&A. Since the prospect of achieving strategic autonomy also depends on how ‘local’ current supply chains are, we offer an in-depth investigation of three dimensions related to foreign dependency (company ownership, tender success, supply chain participation). Despite mean scores of non-EU ownership in the range of 25-30% for the EU’s largest defence firms, foreign ownership does not necessarily threaten the EU’s security of supply. Nevertheless, the participation of non-EU firms concerning M&A with high relevance for the EU defence industry increases, as does the share of defence-related EU tenders that are won by non-EU firms. An assessment of four multinational military aircraft programmes further exemplifies that the EU’s defence R&D and production capabilities may critically depend on outside suppliers. We thus find that the importance of non-EU actors for the EU’s defence industry is large and may not easily be mitigated, particularly if commodity imports are considered.