In August, he then substantiated his vision of the “militarization” of Europe under German leadership in Prague. Scholz called for a stronger, more “sovereign” European Union that must be able to defend itself more effectively.
But what would Germany’s hardly conceivable commitment before the “turn of the era” mean in practice? If the Federal Republic wants to play a leading role in strengthening Europe militarily, it must reorganize its economy – the takeover of a German chip manufacturer by a Chinese company would not fit into the reorientation of the economy towards a war economy. Without transformation, Germany cannot meet the challenges of a geopolitical era in which war once again seems to be an ever-present threat. Which concrete transformation steps are possible?
First, Germany and the European Union should set up a military research and development agency modeled on the US Defense Advanced Research Projects Agency (DARPA), which has been promoting high-tech innovations for decades. Berlin would have to play a pioneering role in the founding of the European DARPA, only in this way could the agency stand up to the technological competition from the USA and China.
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Germany has already taken small steps in this direction. In 2019, for example, the federal government created the Agency for Breakthrough Innovations, which is intended to finance groundbreaking innovations.
A larger pool of innovators is needed
But the agency is too small and, unlike DARPA, does not cooperate with the military. Your ability to make disruptive discoveries is limited. If, on the other hand, a military research facility were created at EU level, things would look very different – if only because of the stronger financial power and the much larger pool of innovators.
The defense sector, as the examples of the USA and Israel show, is a driver of innovation. In both countries, research funded by the military has brought us technological innovations such as the GPS satellite navigation system or the Siri voice assistant as spin-off effects.
But the threat of war in Europe requires a different kind of innovation – so the EU must be able to produce sophisticated military hardware of its own. In order to live up to Scholz’ claim to leadership, Germany should also play a pioneering role in the development of semiconductors and in securing the supply of strategic raw materials. Both are essential for European security.
State initiative is required. It would be better for the governments of the EU states and the US administration to set the course for themselves to be able to produce enough high-tech chips and promote strategic raw materials today rather than tomorrow. Then, for example, the production of cars and machines would no longer come to a standstill, as was the case at times during the corona pandemic, because the Taiwan Semiconductor Manufacturing Company stopped delivering.
China is tightening its rhetoric
Setting such a course seems all the more urgent as China continues to intensify its rhetoric towards the “breakaway province” of Taiwan and the danger of war is growing. The People’s Republic also controls the processing of strategic minerals and metals, including 80 percent of the world’s rare earths; for lithium and cobalt it is almost 60 percent. Against this background, Europe must indeed make every effort to achieve greater strategic autonomy.
If that succeeds, the Europeans would not fall into the trap in which Russia has been stuck since the war of aggression against Ukraine. In recent years, for example, Moscow has relied on supplies from the German armaments group Rheinmetall instead of modernizing the Russian military on its own. In the course of the multilateral sanctions, President Vladimir Putin is now being paid the price for this omission.
Russia’s technological weakness should be a warning to Germany and the rest of Europe. European governments must now strengthen publicly funded military research and development and develop creative ideas for cooperation in the defense sector. The Chip Act proposed by the EU Commission, according to which 20 percent of all chips are to be produced in Europe by the end of this decade, is a step in the right direction. But much more needs to be done.
The author:
Dalia Marin is Professor of International Economics at the TUM School of Management at the Technical University of Munich and Senior Research Fellow at the European think tank Bruegel, Brussels.
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