France Defence and Security Report Q3 2008

The defence White Paper, released on June 17, called for an overhaul of the military establishment, a smaller and more mobile army, closer ties with NATO, and a shift in defence posture to prioritise the threat from terrorism. To free up funds for modernisation the government said it would close 54,000 administrative and support posts over the next seven years, leaving a combined military establishment of 225,000, including civilians. Some 10,000 French soldiers would be reassigned to internal tasks including counter-terrorism, disease pandemics, and cyber attacks. A number of garrisons near the border with Germany, France's traditional 19th and early 20th century adversary, would be closed. Details were subsequently announced in July showing that 83 units (a term that includes regiments, logistics centres, and air force bases) would close in stages from 2009 onwards, leaving a total of 85 to 90. The president said the process would involve hard choices. 'The truth is that we must stop trying to maintain certain equipment that you use every day on a shoe string: supply planes which are 45 years old, light armoured tanks which are 28 years old, and Puma helicopters which are 30 years old' the President said in a speech to top military officers. Prime Minister Franois Fillon was later to summarise the new approach by saying that 'we have a much greater need for intelligence means, force projection means, lighter, more fast-reacting forces, most often in the framework of alliances in cooperation with our allies - those of the Atlantic alliance or of the European Union'. The White Paper said that defence spending, currently a little over 2% of GDP, would keep pace with inflation on the short term, rising in real terms from 2012 onwards. A total of EUR377bn (US$584.8bn) would be spent on the military between 2008 and 2020, with EUR200bn of that earmarked for equipment purchases. Troop capacity for overseas deployment would be reduced from 50,000 to 30,000 (at present the country has 12,000 troops deployed on foreign missions). Over half total military staff are in administrative and support functions, with 40% in operational and combat roles. President Sarkozy also called for closer collaboration with other European military forces. He repeated earlier calls that Europe should be able to deploy up to 60,000 troops to international conflict areas. On the procurement front he signalled a willingness to move away from the independent stance that has seen the all-French Rafale fighter jets, built by Dassault Aviation, competing against the European Eurofighter project. France wants a joint approach to the development of heavy A400M military transport aircraft. Although he noted that nothing stood in the way of France re-joining NATO, he said France would retain control of its own forces and its nuclear deterrent.

France's defence industry represents a significant part of the French economy: 2004 figures show it is worth EUR15bn in terms of orders per annum, EUR3-4bn in terms of exports per annum, and approximately 180,000 people are employed directly by the industry. The industry has been undergoing significant restructuring and consolidation. In 2005 the government privatised the largest French maritime defence organisation, Direction des Constructions Navales (DCN), since renamed DCNS, which is now part-owned by Thales. This was part of a policy through which the state hopes to exercise greater influence over the defence industry by assuming the role of customer, rather than a stakeholder with no voting power.

Further consolidation of Europe's 'big four' - Thales, EADS, Finmeccanica and BAE Systems - may be necessary in the future. In the third quarter of 2007, the government reached a deal with Germany to streamline the cumbersome 'double key' management of EADS and Airbus, but it remains to be seen whether political tensions between the two major stakeholders will now take a back seat.

France ranks among the world's top five arms exporters. The country was the third largest supplier in the 1999-2005 period, with 7% of global deliveries. However, the sustainability of this position is not assured in the face of renewed competition by manufacturers from the US and Russia. France has signed strategic co-operative accords with three Arab countries, including Libya, which could open up the door to future major arms deals.

France is one of Western Europe's most stable and secure countries. Centuries of democratic experience allow it to steer a safe course through any political unrest. Its foreign policies - especially its propensity to take distance from those of the US - dictate that it is far from being the most threatened of states in the region. Furthermore, its well-established defence industry works effectively, both independently and in partnership with France's allies, to ensure that the Republic's armed forces are more than capable of defending France's national interests, with surplus equipment available to propel a thriving arms trade across the world.