The cannonball production workshop at US Army Ammunition Plant in Scranton.

By Lin Yuan

According to foreign media reports, NATO countries are suffering from a serious deficiency of stockpiles recently, causing great concern among its member states. In this context, NATO formulated a new arms production plan, but the future implementation prospect is not optimistic constrained by multiple factors.

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Recently, NATO Secretary General Jens Stoltenberg said that NATO is currently consuming ammunition at a much higher rate than it is producing it, and that production needs to be increased. He  called on the nations to build "a more robust defence industry", stating that he had already engaged in a productive meeting with defence industry representatives from NATO and discussed how to best ramp up production and streamline supply chains.

There are reports that the NATO countries had been confronted with heavy pressure on the defense industry as a result of severely depleted arsenals since the autumn of 2022. The previous production cycle for large-caliber munitions was only 12 months in NATO, which is yet increased to 28 months now. NATO previously convened an extraordinary meeting of the Conference of National Armaments Directors (CNAD) in September 2022, and another meeting of defense ministers in Brussels in February 2023. The common theme of both meetings was around how to promptly address the problem of insufficient stockpiles, for which the participants believed that NATO needs to build a new type of industrial base or increase the capacities of existing ones.

German Defense Minister Boris Pistorius recently disclosed that the German Bundeswehr is also burdened with a widening equipment gap, which is predicted not to be replenished until 2030.

Deep-seated problems

Through a comprehensive analysis, the main reasons for NATO's large deficit of defense production can be attributed to the following factors.

First, unstable industrial capacity. Enjoying the peace dividend since the end of the Cold War, European members of NATO have been kept cutting military expenditure, downsizing their defense industries, and reducing stockpiles including ammunition by shifting to lean and on-demand production, thus their ammunition inventories cannot catch up with its current consumption rate.

Second, joint production frictions. Among the European members of NATO, only the UK, France, Germany, Italy, and Spain exhibit a high level of defense science and technology industry strength, and military giants such as Airbus and MBDA are also funded by these countries. For long, European members of NATO have governing their research and development and procurement of weapons and equipment separately, and those with strong research, development and production capacities also have their own calculations.

Third, future investment uncertainty. European media pointed out that all governments have not yet signed multi-year procurement contracts with the defense industry sectors amidst high economic uncertainty. A senior NATO defence official proposed that defence enterprises are hardly willing to invest in a second production line without long-term contract guarantee, for fear that the procurement contracts would be trimmed once the condition is easing off after they expand the production capacity.

Challenges

To cope with the insufficient stockpiles, NATO member states endorsed the Defense Production Action Plan at the Vilnius summit held in July 2023, urging the organization to leverage its role as "a convener, standard-setter, requirement setter and aggregator, and delivery enabler” to vigorously develop sustainable defense industrial capacity."

It can be seen from the communique released by the summit that the content of this plan focuses on vigorously developing land warfare weapons and equipment, the specific types of which to be announced in the autumn of 2023. In terms of direction, the plan puts priority on promoting the development of small and medium-sized military enterprises. Generally, this plan will encounter challenges in its implementation in the future.

First, difficult procurement. Rob Murray, a senior fellow at the US think tank Atlantic Council indicated that to increase contract signatories and funding amount will be the core part of the Defense Production Action Plan. At present, NATO member states have inconsistent procurement goals because of impact of defense policies, economic strength and other factors. He argued that NATO should encourage its members to adopt optimized procurement strategies and enhance mutual coordination. However, he also puts forward that NATO's arms procurement strategy and collective cooperation projects may not fit for rapid production, and it needs further study on how to facilitate coordination.

Second, nonuniformity of standards. Although NATO has long been promoting the standardization and institutionalization of weapons and equipment among its member states, it is difficult to achieve this target as the procurement channels and models are varied and diverse subject to different specific conditions. However, the interoperability of combat platforms is an important indicator to access the collaborative operational capability, inconsistent production standards will hinder their combined operations and limit the deterrence performance.

Third, incompatibility of the US. Former Senior Advisor to the US Secretary of Defense Douglas Macgregor articulated that European crises are a tool of the US profiteering. According to a recent report released by the Stockholm International Peace Research Institute (SIPRI) in Sweden, arms imports in Africa, Americas, the Asia-Pacific and the Middle East between 2018 and 2022 fell by 40%, 21%, 7.5% and 8.8% respectively from the period of 2013 to 2017, compared to an increase of 65% in Europe. Owing to weak military production capacity, US military products have become an import preference for European countries.

In the future, as an obstacle on the path of American defense industry dominance, the Defense Production Action Plan of NATO is bound to endure intense suppression by the US during the implementation. The New York Times once commented that the US-led NATO forbids duplication of existing capabilities and prods allies to accept niche roles to maintain US leadership. NATO is following the post-WWII design of the US planners to make Europe reliant on the US power with reduced independence and autonomy.