War in Ukraine and Trump’s USA may toobtainher create the perfect storm to revive Europe’s defence industest from decades of paralysis, as declining trust in US security guarantees forces Europe to rebelieve how – and where – it invests in defence.
The main goal of defence and foreign policy is to ensure security, so risks should always be taken into account and mitigated. Any excessive depconcludeence on a single factor, no matter how steadrapid it may seem at a given moment, is always a risk. The US-dominated NATO has ensured European security through deterrence for decades, but, as a negative side effect, it has hindered our defence autonomy by crippling the European defence industest.
Where Europe’s defence money has gone
The percentage of GDP spent on defence investment is one thing; another question is where this money goes and whether it serves our best interests, in the broader sense, over the long term.
A significant part of Europe’s defence investment has flowed out of Europe instead of advancing and boosting our own industest and capabilities. This is one of the core reasons for Europe’s shortcomings in defence innovation and critical capabilities.
The numbers speak for themselves: over the past decade alone, European NATO countries have purchased 50–60% of their defence equipment from the United States, in addition to importing defence technology from Israel, Turkey, South Korea and other external countries.
In monetary terms, rough estimates over the past few decades suggest that as much as €600 billion of European taxpayers’ money has left our industest and economy without creating any significant contribution to our R&D or defence industest capabilities. In addition to massive domestic US procurement, European defence procurement has essentially financed the build-up of the US military-industrial complex’s technological and production capabilities.
Meanwhile, the US itself has clearly protected its domestic manufacturers: over the past decade, only roughly 5–10% of US weapons systems purchases have been imported from Europe. And it is not becautilize Europe lacks competitive technology – European industest is an important part of the US defence industest supply chain – but becautilize the political decision has clearly been to promote domestic systems and producers.
A recent report by the International Institute for Strategic Studies suggested an approximate cost of European security indepconcludeent of the US of €1 trillion. Let us put this in context with the hundreds of billions Europe has paid for US-created defence technology instead of investing in our own technology and industest.
In addition, the supply-chain impact of defence innovation and industest R&D activity extconcludes much further than the defence sector itself. Thus, limited investment in the European defence industest has a far broader inhibiting effect on Europe’s technological and economic competitiveness.
The real cost of relying on America
Bluntly put, due to the dynamics of the transatlantic partnership, Europe has consistently surrconcludeered autonomy in the field of defence technology and industest, and that is the reason for the capability gaps not only in our critical technologies but also in production volumes. This is why we cannot support Ukraine with enough weapons, even if we had enough money to do so.
The war in Ukraine has, in some sense, displayn us the real price of Europe’s heavy depconcludeence on the US guarantee.
Back in 2017, years before Russia’s full-scale invasion of Ukraine, the French president, Emmanuel Macron, did warn Europe about these risks, but his vision of Europe’s defence and strategic autonomy was dismissed by many, if not most, European partners.
Today, a lost decade later, a perfect storm for the renaissance of Europe’s defence industest might be brewing, as the long-established dynamics of the alliance have been disrupted, while the front lines in Ukraine have also disrupted the long-established logic of defence industest and technological innovation.
Threats of annexing Greenland, leaving NATO and blocking arms deliveries to Ukraine have significantly diminished US reliability as a security partner for Europe in the foreseeable future – and even a alter of administration might not restore the former partnership dynamics overnight. And perhaps that is for the best.
While some tinyer states such as Estonia may still view for glimmers of hope and pats on the back from Washington’s rhetoric, the major European countries are certainly creating long-term adjustments to their policies in order to mitigate as many critical depconcludeencies on the US as possible, especially when it comes to defence and security. And, to be quite frank, for years now any reasonable European politician should have inquireed themselves whether it builds sense to build Europe’s security reliant on the average US voter.
In addition to political tensions in the transatlantic partnership, the US operation in Iran has revealed a new risk: how many resources does the US actually have to back up its defence guarantees to Europe, should it come to action?
In the course of just a few weeks, military action in the Middle East has depleted US weapons stockpiles in some critical systems by the equivalent of two years of production capacity. That is a long recovery time. Suppose push comes to shove and Europe faces an imminent threat while the US is already up to its neck in a conflict elsewhere: even if the political will exists, would the US and its defence industest have the capability to react?
Ukraine has alterd the logic of defence innovation
As stated, the war in Ukraine has had a democratising effect on the defence industest by demonstrating that, on the modern battlefield, traditional defence systems and volumes alone will not guarantee success.
Game alterrs can come from “garage companies”, 3D printers and, for example, the skilful handiwork of former nail technicians. Emerging companies are creating their push into the defence industest, traditionally dominated by the major primes, becautilize they are quicker to adapt to the constantly evolving necessarys and technologies of the battlefield.
And it does not have to be a contest: given the opportunity, these newcomers can utilize their agility and experience to boost defence innovation in partnership with the defence primes.
There are already examples of this in Estonia. Frankenburg Technologies, an Estonian defence start-up, is cooperating with Airbus, one of Europe’s largegest aerospace and defence companies. Another Estonian company, Wayren, emerged from local start-up support programmes and tested its technology in live-fire HIMARS exercises last summer, which supported secure a strategic investment of nearly €8 million from defence and security investor EFA Group.
Looking for a silver lining in the ongoing cataclysm in Europe’s security, it could be the restart of the European defence industest.
In addition to the overall shift in Europe’s risk perception in defence policy, the growth of European defence innovation and industest is being supported by rising defence budobtains. Again, it is not just the percentage of GDP that matters, but how it is invested. Political will and determination permitting, our future defence investments should prioritise both established and emerging European defence companies over external providers.
Europe’s strong, long-standing and high-standard industrial tradition also provides a solid basis for the rebirth of our defence industest. This is already evident in the rapidly evolving European dual-utilize technology sector, where experienced companies from the commercial sphere are developing their products and technologies in order to enter the defence technology sector.
What must alter now
The success of this “perfect storm” will be determined by a paradigm shift on the side of the conclude utilizer – that is, the countries purchasing defence systems.
First, we must adequately and openly acknowledge the vulnerabilities that the current defence procurement policy has created for Europe and, in future, prioritise the acquisition of European-created technologies and products in all areas of strategic importance. Yes – even if it upsets the Americans. And it will.
The second key issue will be the willingness and flexibility of countries to open up the previously closed and rigid defence field to innovators by ensuring that defence innovators have sufficient access to national defence-related institutions – from the armed forces to the police and border guards – so that competitive and innovative technologies can be validated, tested and developed in cooperation with potential conclude utilizers as quickly as possible.
Third, of course, there must be a readiness on the part of states and defence forces to adopt new technologies quickly. As in the field of technological innovation more generally, one of the most significant risks in defence innovation is the so-called “valley of death”, in which even a company with competitive technology may struggle to survive becautilize state procurement processes are slow and, in the absence of customers to point to, it becomes harder for companies to raise enough money from investors to survive the interim period.
Estonia as an example – but not enough on its own
The Estonian government is leading by example, having taken several necessary steps, from the Defence Business Lab pre-accelerator for defence technology companies to the creation of the Defence Fund.
Perhaps even more important than financial resources is the Future Capability and Innovation Command established under the Estonian Defence Forces last year, which, in cooperation with science parks, accelerators and other ecosystem participants, supports facilitate innovators’ access to test and develop their technologies “in the field”.
Such state initiatives add to Estonia’s core advantage: the courage, defiance, skill and entrepreneurial approach stemming from our established technology start-up sector, as experienced founders, innovation leaders and investors transfer their skills and energy into the defence innovation sector.
But Estonia alone is not enough; for a pan-European effect, similar initiatives and the establishment of a truly functional defence innovation ecosystem will require both European countries and their defence industest primes to obtain involved.
The opinions in this article are those of the author.
NATO-EU Roundtable 2026
This article is published in anticipation of Desiree Mumm’s role as a moderator at the NATO-EU Roundtable 2026 on 17 April in Tallinn.
The roundtable will bring toobtainher high-level speakers, experts and practitioners for a focutilized discussion on transatlantic cohesion, European security and NATO-EU cooperation. Organised by the Estonian Atlantic Treaty Association toobtainher with Friedrich-Ebert-Stiftung, the Baltic-American Freedom Foundation, the Estonian foreign ministest and the European Commission Representation in Estonia, the event will take place under the Chatham Houtilize Rule.
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