March 16, 2018

What is PESCO?

Estonian Army general Riho Terras and European Council President Donald Tusk address a speech on the launching of the Permanent Structured Cooperation, or PESCO, a pact between 25 EU governments to fund, develop and deploy armed forces together, during a EU summit in Brussels, Belgium, December 14, 2017.
Estonian Army general Riho Terras and European Council President Donald Tusk address a speech on the launching of the Permanent Structured Cooperation, or PESCO, a pact between 25 EU governments to fund, develop and deploy armed forces together, during a EU summit in Brussels, Belgium, December 14, 2017.

The EU’s new defence initiative is creating a new situation in member states’ defence cooperation

The EU’s new defence initiative is creating a new situation in member states’ defence cooperation

The EU’s new defence initiative, PESCO, has received a lot of attention in the past year. It is still early to evaluate its wider significance, but its launch has certainly created a new situation in EU member states’ defence cooperation. It is also a European political success story, from which Estonia also reaped some glory during its recent presidency. The main issue for Estonia is whether PESCO in fact increases or reduces European security (despite the opportunities provided by this framework also to develop the defence capabilities Estonia needs)—the latter prospect being a reference to the weakening of the Euro-Atlantic security architecture and the growing distrust between Washington and European capitals.
PESCO stands for Permanent Structured Cooperation. For some, PESCO is exciting, while others just shrug or are outright opposed to it. Long story short, it is an EU defence cooperation mechanism, which was specified in the Treaty of Lisbon that entered into force in 2009. Article 42.6 and Protocol 10 were written into the treaty at the request of member states “whose military capabilities fulfil higher criteria” with a view to “the most demanding missions”. Even if some member states wanted it, the political consensus was not strong enough to implement this cooperation until last year. The mere thought of European defence cooperation was met with reluctance in several countries.
However, Europe’s political reality has changed so much over the last few years that, by November 2017, 23 EU member states (including Estonia) presented to the High Representative and the Council of the European Union their joint declaration of intent concerning the launch of structured defence cooperation. Ireland and Portugal joined in December, as their decision was delayed due to domestic procedures. So far, the only states left out of the process are the UK, which is scheduled to leave the EU, Malta, which was wary of additional defence obligations, and Denmark, which has opted out of EU defence cooperation. As soon as the EU Foreign Affairs Council had officially made the decision to launch PESCO on 11 December, the “Sleeping Beauty of the Treaty of Lisbon” (as it was dubbed by Commission President Jean-Claude Juncker) had been woken.
One of the reasons defence issues became the centre of attention in Europe was that this helped mobilise the EU, which was weakened following the Brexit vote in the summer of 2016. Secondly, specific external threats from the east and south loomed over the Union. Europe was taken by surprise by the migration crisis—the outcome of all the tensions and conflicts near Europe that forced thousands of people move in its direction. France has become the target of Islamist terrorist attacks following its military involvement in Mali, but several other countries also suffered from terrorist violence. The annexation of Crimea in 2014 and Russia’s hybrid war in eastern Ukraine increased overall uncertainty. Even the US under Donald Trump has become unpredictable for Europe and mutual trust has significantly decreased.
As a result of all this, the age-old engine of the EU—the French-German tandem—turned to defence cooperation. This was supposed to help find a new positive dynamic for the whole of the EU. At the same time, Paris and Berlin had to find some middle ground to mobilise European defence resources in a situation where the UK was set to leave the Union and nobody could know what London’s defence cooperation with the EU would be like thereafter. There is no doubt that the absence of British forces will leave a large gap in EU military capability; however, it was the UK that put up the greatest resistance to European defence cooperation. Following the Brexit vote, British opinion was no longer taken into account and defence cooperation was given another chance. Paris agreed to Berlin’s vision of a comprehensive but less ambitious PESCO that would not draw new dividing lines in Europe. In return, Germany has been more tolerant of France’s rather fixed position in discussing the principles of the structure of another new defence initiative, the European Defence Fund (EDF). This is a fund established by the European Commission to invest in defence research projects, both in technology and capability development, that are important for Europe.
A wider context for Europe’s recent defence initiatives is provided by the Common Foreign and Security Policy (CFSP) prepared by the High Representative, Federica Mogherini, in 2016. This document created a new level of ambition for the EU Common Security and Defence Policy (CSDP) and generally described a variety of CSDP missions and operations for which member states required military capabilities. The EU Military Committee was tasked by the Council to review potential scenarios that could be used as a basis for planning missions and operations. The most ambitious of these scenarios—one foreseen in the Treaty of Lisbon—involves guaranteeing peace somewhere outside Europe.
The military capabilities needed to achieve this level of ambition are also one of the 20 obligations listed in an annex to PESCO that member states have taken upon themselves. Inter alia, PESCO member states have an obligation to increase their defence expenditure and contribute to EU battlegroups—the main obstacle to which is the lack of a joint financing mechanism—and to CSDP missions and operations. These obligations are slightly more detailed than Protocol 10 of the Treaty of Lisbon. Even though EU defence ministers approved the PESCO action plan in the Council on Foreign Relations on 6 March and specified some nuances in the process, there are still more questions than answers over PESCO. If anyone claims to know how things are going to be run, their words should therefore be taken with a pinch of salt.
There are several technical questions that, one way or another, concern ownership relations in the process or participation in it. For example: PESCO as a cooperation framework appears to be run by member states, but it remains to be seen how much bureaucracy they will in time hand over to the PESCO Secretariat, which consists of representatives from the European Defence Agency (EDA) and the European External Action Service (EEAS), including European Union Military Staff (EUMS). PESCO has a two-layer structure, where the task of the top level, managed by the Secretariat, lies in preserving coherence and aims. On the project level, participating states create a management procedure for each project, and here members probably want to maintain tighter control.
Disputes have also arisen over how much of a voice the final consumer (in this case, the EUMC—European Union Military Committee) should have in the process. After all, the aim of PESCO is to develop military capabilities for the member states’ armed forces. If the EDA makes decisions based on whether PESCO’s actions match the set criteria, and member states jointly work on projects that matter most to them, the military committee (composed of member states’ Chiefs of Defence Staff, who are regularly represented by their permanent Military Representatives) should keep an eye on whether the projects contribute to the overall development of EU military capability. According to the PESCO plan of action, the EUMC provides military advice both on future projects (not yet on current ones) and in compiling the annual PESCO report submitted to the Council.
In order to find out what capabilities and units the member states need to achieve their ambitions, the EU has used the Capability Development Plan (CDP) managed by the EDA. The CDP uses a complicated mechanism and various inputs to ascertain what military capabilities the member states have and which lacking capabilities need priority development. One of the main questions is whether and how the EU CDP—which has so far been based on CSDP missions and operations—will link with PESCO, whose reach is much wider, encompassing various projects connected to capability development and operational readiness, which the member states wish to advertise to others. The existence of commonly understandable and accepted PESCO criteria that, among other things, take into account the capability deficits discovered through CDP, is of key importance, since every member state has its own interests and the process is therefore subject to heightened political attention.
In order for PESCO to succeed, we first need the right projects. These must be visible, understandable and primarily necessary for strengthening the EU’s defence capability. Second, each country must choose one or more projects in which it genuinely wants to participate, not simply tag along. The first round currently includes projects that it has tried (with little success) to implement in the past. This does not necessarily mean they are bad projects—put simply, military capability development is so costly that even the wealthiest European states have a hard time doing something alone. Now it is hoped that PESCO will bring a new lease of life for them—if these projects match the criteria and if the projects’ lead nations find plenty of partners and co-financers.
In considering the EU capability development dynamics, one must take into account the NATO aspect. Even though most member states belong to both organisations, two-way communication is still complicated, due mainly to countries that are not members of one or the other. Even though the two capability development processes have external similarities and have been harmonised and coordinated as much as possible, the EU and NATO defence plans are intrinsically hard to compare. NATO’s raison d’être is allied collective defence against external threats. The aim of the NATO Defence Planning Process (NDPP) is therefore to figure out the necessary military capabilities for collective defence and boost their development if necessary. For the EU, the CSDP is merely one—and far from the most important—instrument in the implementation of the so-called integrated approach, i.e. projecting the EU’s influence to the wider world.
Even though NATO has traditionally looked upon EU defence initiatives with distrust, there has been progress here in recent years. Suffice it to mention the EU-NATO Joint Declaration, signed in Warsaw on 6 December 2016, and the resulting joint proposals. The current keywords that attempt to soothe the mismatches in capability development include single set of forces, complementarity, and no duplication. “Single set of forces” means that, if one state is developing its military capabilities, it will not act exclusively in the interests of NATO, the EU, the UN or itself, but can use these capabilities at its discretion anywhere and at any time. For example, member states need strategic transport or aerial refuelling capability regardless of the mandate under which they are participating in an operation.
If we look higher up, beyond the project level, one may well ask in the light of PESCO’s launch whether European defence will actually grow stronger as a result, notwithstanding the political rhetoric. Could it be that, in the end, PESCO will turn out to be a dangerous substitute activity that will direct Europe’s attention and energy in the wrong direction? From Estonia’s point of view, could structured cooperation actually weaken our security by eroding trust in Europe’s relations with the US and setting protectionist limits on the US and British defence industries in the European market? For Estonia, the issue is not so much how the European countries organise their defence cooperation (especially capability development), but rather how the creation of PESCO and the EDF will influence Europe’s relationship with the US and NATO.
On the one hand, Washington has long criticised the fact that European countries do not contribute enough to their military capability, but once they actually began doing this, the US has watched cautiously. Some critics claim that Europe has not managed to make itself clear on the transatlantic level. Even though PESCO and the EDF are still in the process of being created and not a single project has been launched, there is widespread criticism in the US that the American defence industry will be pushed away from the European market due to the elimination of “third countries” and their companies. In the case of the EDF it is also claimed that it creates an unfair competitive advantage for the European defence industry. PESCO’s action plan does not exclude “exceptional” participation in projects by third parties, but the manner in which this will take place is due to be decided before the end of this year. This is doubtless a sensitive topic and it involves more than the US or the soon-to-leave UK. For example, Norway’s or Switzerland’s participation in a project would raise a lot fewer questions in some member states than Turkey’s.
PESCO was launched because Europe had the political will to do so. The difference from the previous situation in EU defence cooperation is that decisions used to be made through intergovernmental agreement, and now the member states have taken on long-term obligations and are about to create a permanent mechanism to manage this cooperation. PESCO is legally binding on states. It is in Estonia’s interests to use this opportunity and join the projects that are important to its national defence but which the country could not carry out alone, either due to lack of resources or simply because it requires cooperation between several countries. An example of international cooperation is the Dutch-led military mobility project (dubbed “the military Schengen”), in which Estonia is very interested in participating. Put simply, the aim is to get rid of all legal, administrative and technical restrictions that would prevent member states’ units and arms or equipment from moving freely within the EU. In addition, the topic of military mobility also encompasses wider preparation for the building or adjustment of currently lacking military infrastructure.
As mentioned above, in order to succeed PESCO will need good projects backed by a critical mass of member states. If the current political will for defence cooperation is preserved and channelled, and if an optimal bureaucratic model is found to keep the process going, PESCO could work out. If not, the entire process will function for a few years at half capacity, and slowly die in talking shops. PESCO’s success will thus depend on development on various levels. In addition to specific projects succeeding, there is also the important task of convincing NATO allies—mostly the US, but also those EU member states more sceptical about defence cooperation—that PESCO will strengthen, not destroy, Euro-Atlantic unity. Estonia and several other NATO allies would certainly not agree with defence cooperation that would work against the US or weaken NATO. Given that NATO and the EU have 22 member states in common and defend a common value space, these two organisations should not compete in military capability development or any other field, and should instead complement each other.
If Europe wants to become a global power not just economically but also militarily, it will need military instruments. Even though there are people in Europe who dream of such a wide strategic autonomy in which the EU would not have to rely on NATO and the US presence to guarantee its security, and hope that the new defence initiatives could lead to the creation of a European army in the future, it remains a rather fanciful dream for the time being. We are currently talking about creating certain missing military capabilities through a better-organised mechanism. We will soon see who will cooperate and in which areas, and how much resources are actually contributed. After that, it will become clear whether the sceptics and critics were right, or whether EU defence cooperation has truly been resuscitated.
Estonians are a practical people. This is reflected in the words of Riho Terras, Commander of the Estonian Defence Forces, in Brussels at the PESCO launch ceremony on 14 December: “It is an inclusive and ambitious cooperation platform that signals the wish of the 25 member states to make the EU stronger militarily. For EU citizens this means more security.” It is as simple as that.

This article reflects the author’s personal opinions.


This article was published in ICDS Diplomaatia magazine.