Local jobs key to cross-border deals, Francken says
Belgium's defence minister spoke at a factory opening outside Brussels
Cross-border defence procurement deals are more likely to succeed if companies commit to manufacturing in the target market, Belgium’s defence minister has said.
Theo Francken was speaking at the inauguration of a new facility outside Brussels owned by Greek optics maker Theon, built to service a joint German-Belgian order that it won last year.
“When I get a €4 billion budget, the first thing people ask is ‘what’s in it for us?’,” Francken said. If a supplier commits to opening a local production line, “that’s what I need to hear: jobs, jobs, jobs.”
While EU policymakers push to integrate the bloc’s defence market, big contracts still tend to be awarded to national producers. A bumper German drone contract, worth an initial €540 million, was this year split between two German companies: Helsing and Stark. The UK is persisting with Ajax, an armoured vehicle project that has repeatedly failed field tests, at least in part to preserve manufacturing jobs.
Francken joked that he always enjoyed opening factories in Belgium, but this occasion was even sweeter for being in his home constituency of Zaventem. “I’m a politician,” he grinned.
Greeks bearing goggles
Today’s ceremony marked the formal opening of Theon’s Belgian subsidiary, following its winning bid in September to manufacture its clip-on thermal imaging device, IRIS-C, for the German and Belgian armed forces. The device attaches to a soldier’s helmet and can detect people and vehicles at night or through cover.
“The European defence industry is fragmented,” said Theon CEO Christian Hadjiminas. “Every nation, understandably, has the desire to support its own industry... there’s no optimisation.”
Nevertheless, he said, the deal shows that there’s room for relatively small European defence companies to win big cross-border contracts. Besides the commitment to manufacture in Belgium, he also credited cross-border procurement agency OCCAR with bringing the deal together.
OCCAR, formed in 2001, coordinates the procurement of defence equipment between Belgium, France, Germany, Italy, Spain and the United Kingdom, sometimes with guest nations also participating. Its projects include the A400M transport aircraft and the Boxer armoured vehicle.
Theon hopes that its new Belgian facility can eventually develop into an export hub for future contracts across Europe, Hadjiminas said. “Here is the example of where Europe should be going.”
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