Rising tensions - Raytheon€¦ · ing air and missile defence capabilitiesas well,possiblyTHAADortheAegisAshore batteries thathaveformedthe foundation of NATO’s European PhasedAdaptive

NOVEMBER 2016 Sponsored content in association with Raytheon

Air and missile defence in Europe

As regional security deteriorates,Europe is bolstering its nationalanti-ballistic missile defences

IHS Jane’s Strategic Assessment and Futures Studies Centre

Risingtensions

Also in this supplementn The global context

n Current and future threats

n Concepts, tensions, requirements

2 IHS Aerospace, Defense and Security November 2016

AiR And missilE dEfEncE in EuRopEPh

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A ir and, particularly, missile defenceefforts in Asia-Pacific and the Mid-dle East have outpaced activity in

Europe for much of the past decade. How-ever, Russia’s State Armaments Programme,annexation of Crimea and invasion of East-ern Ukraine, escalatory rhetoric and struc-tural state weakness have recently infusedthe missile defence discussion in Europewith a heightened sense of urgency.

So, too, have broader concerns aboutproliferation of unmanned systems, missilesand rockets to and from Iran, as well as thepossibility of a rogue launch or coercive useof air and missile systems. NATO and sev-eral individual European states – notably,Poland, Germany and the Netherlands –are investing in multiple, sometimes com-peting, approaches to meeting the diverse,dynamic and durable air and missile defencechallenge. Industry leaders will be present-ed with a target rich and competitive mar-ket. They will need to work closely withend-user communities to strike complicat-ed, but critical, balances between severaltensions and emerging requirements.

layered capabilitiesNotably, industry and militaries mustdevelop layered capabilities to meet a vig-orous and varied threat and be able to createhigh-degrees of interoperability with alliesand regional neighbours, all while manag-ing the typically high-costs associated withair and missile defence.

They also must balance the need todevelop and deploy proven and reliablecapabilities that meet immediate challeng-es while still providing the possibility ofupgrading capability or incorporating newtechnologies (such as gallium nitride radartechnologies, 360-degree radars, and openarchitectures to enhance plug-in-and-fight

interoperability) to meet the certainty ofnew threats. The need in some cases toengage local industry introduces potential-ly complicating dynamics into an alreadyhyper-competitive environment and couldextend timelines associated with the devel-opment, delivery and deployment of airand missile defence capabilities.

Ultimately, the ability of industry com-petitors to provide a proven capability thatwill have multiple channels – user commu-nities, lower cost technologies, new oper-ational concepts and capacity to leveragethe full-range of company resources – forreducing cost will provide significant com-petitive advantages in an active market.

This supplement is divided into fourlinked sections that seek to:n frame the discussion around the impor-tance of air and missile defence capability ina shifting global context;n explore the current state and possi-ble future trajectory of European missiledefence and the air and missile threats itfaces;n assess active or impending air and mis-sile defence programmes in Europe andidentify key market trends, procurementpriorities or emerging operational require-ments; andn explore a series of concepts, tensions andrequirements for national and multi-na-tional missile defence systems.

Research and analysis contained in thesupplement leverages ongoing SAFS Cen-tre research initiatives (NATO Futures,Emerging Military Competitions and DefenceIndustry 20YY) as well as IHS Jane’s report-ing, secondary source research and inter-views with and commissioned materi-als from a dozen different subject matterexperts within IHS AD&S and our networkof experts and industry contacts. n

IHS Jane’s Strategic Asessments and Futures StudiesCentre is pleased to present this special report examiningthe future of air and missile defense in Europe

Editorial

This report has been commissioned by Raytheon, but IHS AD&S retained full control over the content

(Top) A THAAdmissile interceptoris put through an operational testin Hawaii (Below) us Army privateJonathan Valentine demonstrateshow to reposition a patriot missilelauncher while on an exercise withthe Romanian Air force.

conTEnTs3 The global contextA worldwide perspective on the driversof missile-versus-missile competition6 Current and future threatsRussia’s annexation of Crimea has givenfresh impetus to defence programmes10 National missile defencesExamining Germany, Poland, the Neth-erlands and Lithuania’s defence efforts13Concepts, tensions, requirementsExamining the factors that are shapingthe future of European defence

3November 2016 IHS Aerospace, Defense and Security

AiR And missilE dEfEncE in EuRopE

T he missile-versus-missile contest is oneof six domain area competitions theSAFS Centre monitors due to their

central role in shaping the future of militaryconflict, as well as the trajectory of global andregional geopolitical competitions.

The confluence of these pervading geo-political, technological, military and securi-ty trends and drivers ensures that capabilitiesand related conepts steadily evolve, or evenradically shift at times. Such developmentscould undermine, abrogate or, conceivably,reinforce strategic balances or stabilise mili-tary imbalances. Disturbances to these could,in turn, drive regional competitions andsecurity environments along new, potential-ly destabilising and perhaps under-explored,pathways in a shifting global context.

The global contextIn a November 2015 speech in Aspen, Colo-rado, RobertWork, theUSDeputy Secretaryof Defense, said: “Great power competitionhas returned.” His comment was accurate,but also incomplete: intensified competition

is occurring between far more than the smallhandful of great powers. Think of Iran andSaudi Arabia (and other Gulf States); or Chi-na and Japan (or India); or the tense situationon the Korean peninsula.

Rising competitive geopolitical forces arethe result of a sense that the predominanteUS/Western-led geopolitical frameworksof the past 25 years are eroding or falteringin response to the manifold pressures of themodern world. Some of these are domesticin origin or borne of widening gaps in val-ues, perceptions and priorities between keystakeholders in these frameworks.

Other pressures, though, are driven bystate and non-state actors seeking to estab-lish a new type of international relations,in which rules and institutions are changedand global power and influence is diffusedfrom the US and its closest allies. China’sleadership consistently raises this theme,frequently coupling it with the concept of“win-win co-operation” with few condi-tions between China and its partners. Rus-sia, too, has embraced and furthered the

narrative of a transforming geopolitical sys-tem and the frailty of existing norms, suchas those around arms control. Russia’s 2013Foreign Policy Concept said: “The princi-pal and emblematic feature of the currentinternational landscape is the deep-seatedtransformation of the geopolitical land-scape, the essence of which is transition toa polycentric or multipolar world ... [in thisenvironment] states seek to augment theiroffensive potentials and develop new kindsof weapons thus eroding the structure ofglobal security and even the system of armscontrol agreements.”

The erosion of existing geopoliticalframeworks has increased the incentivesfor both state and non-state actors to takegreater risks. Sound frameworks tend toengender (mostly stabilising) norms thatbind behaviours and ensure there are con-sequences for violating these norms. Overthe past two years, the international systemhas experienced more assertive behaviours –more rules breaking – frommany states withfew, if any, consequences – from Crimea to

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The global contextA worldwide perspective on the drivers behind missile-versus-missile defense competition

A Romanian soldier inspects a mim-23 missile system during an exercise with the us in capul midia on 7 november 2016.



the Korean peninsula to the South ChinaSea. The result, for now at least, is a con-vulsive world vulnerable to repeated retch-ing shifts and brazen applications of nationalpower. Defence and security communitieswill need to expand their thinking aboutlikely, possible and even previously un- orunder-explored plausible threats; namely,missile strikes against Europe or, perhapsmore likely, Russian use of missile threatsto subordinate, destabilise and intimidateNATO allies or other vulnerable states inthe former Soviet “near abroad”.

The diffusion and clever use of advancedmilitary and, in some cases, dual-use andcommercial technologies is also affectingthe global context, amplifying geopoliticalcompetitions and shaping the current andfuture parameters of air and missile defencechallenges. Proliferation of advanced tech-nologies affords actors the opportunity todevelop asymmetric capabilities and opera-

tional concepts that can: hold more militar-ily advanced adversary or competitor assetsat risk; create anti-access/area denial (A2/AD) cordons in which adversaries cannoteffectively operate; and/or deter, dissuade orcoerce adversaries and competitors in timesof crisis. Cyber-technologies, effective stra-tegic communications and influence oper-ations, electronic warfare weapons (suchas jammers), swarmed unmanned systems,enhanced sensors, nuclear weapons and, ofcourse, cruise and ballistic missiles top thelist of these diffused and impactful technolo-gies that target the vulnerabilities of modernmilitaries and liberal political systems.

Another challenge posed by the diffusionof novel technologies and capabilities is thecreation of unbalanced cost curves. Devel-oping asymmetric capabilities is frequentlyinexpensive, but defending against them canimpose disproportionate costs, a lesson thosetracking missile defence issues will know

common THEmEsMissile defence activity in Asia and theMiddle East are not necessarily a perfectanalogue for understanding the futurechallenges, opportunities and require-ments for missile defence in Europe.However, several common themes canbe applied to discussions of Europeanmissile defence.n The persistent need for layered mis-sile defence to meet a multi-dimensionalthreat.n The growing need for interoperabilitybetween layers in a national system andbetween multi-national partners.n The need to evolve deployed capabili-ties over time.n The cost-imposing element of devel-oping missile defence capabilities andconcepts in response to robust A2/ADcapabilities.

us soldiers talk after a routine inspection of a patriot missile battery at a Turkish military base in Gaziantep in 2013.

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well. Flipping asymmetric cost curves bydeveloping new competition-affectingtechnologies is among the primary moti-vations for the US Department of Defense’srecently announced Third Offset Strategy.

missile-versus-missile defenseThe missile-versus-missile defense competi-tion has unfolded and escalated for well overa decade as part of the geopolitical strugglein Asia-Pacific and the Middle East. In theWestern Pacific, North Korea’s develop-ment and repeated testing of ballistic mis-siles – over 20 ballistic missile tests in 2016as well as two nuclear tests – and the opaqueand unpredictable decision-making of KimJung Un have created heightened anxiety inSouth Korea and Japan about missile attacksor coercive use of North Korea’s missile andnuclear programmes. Both countries haveinvested in enhanced and layered missiledefence capabilities as a result.

In July 2016, the South Korean gov-ernment agreed to deploy Lockheed Mar-

tin’s Terminal High Altitude Area Defense(THAAD) system. Details of the deploy-ment are still being determined, but the sys-tem is expected in 2017 to join Raytheon’sPatriot PAC-3 and PAC-2 systems that arebeing upgraded to the new configuration.

Japan is adding new layers to its exist-ing air and missile defence capabilities aswell, possibly THAAD or the Aegis Ashorebatteries that have formed the foundationof NATO’s European Phased AdaptiveApproach (EPAA) missile defense system(see pages 6-9). Japan’s defence ministryis also bringing forward the purchase ofadditional ground-based Patriot PAC-3interceptor missiles, among other movesdesigned to enhance layered missile defence.

These announcements have not beenwell-received in China, which has expresseddisquiet with South Korea’s deployment of aTHAAD system that will include coverageof Chinese territory, limiting potential airand missile operations within China’s sov-ereign territory (NATO has a similar con-cern with the deployment of Russian S-400air defence systems that could conceivablytarget NATO assets operating in NATOterritory: Poland, for example).

Moreover, these systems and other missiledefence systems operating in Northeast Asiacould compromise the efficacy of China’sA2/AD modernisation effort. A key com-ponent of this programme is the develop-ment and deployment of increasingly capa-ble ballistic missiles and land, air and ship-launched cruise missiles that together canoverwhelm existing missile defences. TheUS Department of Defense highlighted thisthreat from China’s military modernisationin multiple annual reviews to Congress, aswell as the 2014 Quadrennial Defense Review,

which noted: “Growing numbers of accu-rate conventional ballistic and cruise missilethreats represent an additional cost-impos-ing challenge to US and partner naval forcesand land installations.”

The air and missile defence challengeis also playing out across the Middle East.Iran, in particular, is developing and diffus-ing unmanned systems, missile and rockettechnology designed to “compensate for theweakness of its air force and as a credibledeterrent”, according to Jane’s Defence Week-ly in its October 2015 article “Gulf Shield:Missile threats and defence in the GCC”.

Many Gulf States have responded byupgrading their current missile defencesystems or procuring multiple overlappingand layered air defence systems capable ofcountering current and future Iranian air-borne threats. The UAE has upgraded itsPatriot anti-ballistic missile defence capabil-ities to PAC-3 standard while also becom-ing the first export customer to equip theTHAAD system. Kuwait and Saudi Arabiahave committed to upgrading their ageingPatriot batteries to PAC-3, while Qataris due to have 10 Patriot PAC-3 batteriesoperational by the end of the decade. Whileacknowledgement that regional air and mis-sile defence collaboration is useful, US-ledefforts to forge a collective approach to mis-sile defence amongst Gulf States has thus farbeen stymied by individual security con-cerns and regional political issues.

The proliferation of missile and rockettechnology to non-state actors in the regionhas produced another layer of air and missiledefence concerns in the Middle East (withpotential consequences for Europe as well).Saudi Arabia has claimed on multiple occa-sions in the past year to have interceptedmissiles and rockets fired by non-state armedgroups within Yemen, including on 21 June2016 when a Saudi Patriot battery operat-ing within Yemen shot down a projectilefrom a BM-27 Uragan multiple rocket sys-tem based in Yemen. Israel is also threat-ened by saturation attacks from non-stategroups armed with a huge cache of prolif-erated short-range rockets and has devel-oped a robust layered system as a result thatincludes Iron Dome, David’s Sling, Arrow-3and Patriot.n

The proliferation of missileand rocket technology to non-state actors in the region hasproduced another layer of airandmissile defence concerns inthe Middle East



m issile defense in Europe has laggedbehind efforts in Asia and theMid-dle East as the continent sought to

balance a spectrum of more urgent threatsand crises: terrorism, the war in Afghanistanand Libya, the fallout of the global financialcrisis, the rise of nativists and populist move-ments, and, most recently, immigrationfrom the Mediterranean, the Syria conflict,the coup and purge in Turkey, Brexit andexistential threats to the European project.

However, the threat environment overthe past five years – and especially since theRussian annexation of Crimea and inva-sion of eastern Ukraine in early 2014 – haschanged. In response, NATO and individualEuropean states are demonstrating renewedfocus on the diverse, dynamic and durableair and missile threat to Europe.

The EpAAFor NATO, the Europe-wide missiledefence discussion started in the mid-2000sand came to fruition in September 2009when US President Barack Obama launchedthe European Phased Adaptive Approach(EPAA). It became a NATO programmein 2010. NATO says the EPAA is “purelydefensive” and of “limited capability” to pro-vide enhanced security to allies in an uncer-tain and accelerating threat environment.NATO’s website explains: “Proliferation

of ballistic missiles poses an increasing threatto Allied populations, territory and deployedforces. Many countries have, or are try-ing to develop or acquire ballistic missiles.The proliferation of these capabilities doesnot necessarily mean there is an immediateintent to attack NATO, but it does meanthat the Alliance has a responsibility to takethis into account as part of its core task ofcollective defense.”

The programme originally involved fourprogressive phases of capability development

and deployment of both sea- and land-basedballistic missile defence systems (see chart onpage 9). In May of 2015, work was com-pleted on the installation of the Aegis Ashorecapability in Romania – combining Lock-heed Martin’s Aegis ballistic missile defencesystem with Raytheon’s SM-3 interceptor.The second phase of the programme becamefully operational in July 2016. Phase III plansto install an Aegis Ashore platform in Polandin 2018.

Phase IV was cancelled in March 2013purportedly due to cost and capability con-

cerns. Some viewed the cancellation ofPhase IV as a means of engaging Russia,which strenuously objected to all of EPAA,but especially the Phase IV deployment oflonger-range interceptors as a threat to Rus-sia’s strategic nuclear deterrent.

The threat from iranEPAA was originally conceived to defendagainst and deter either coercive use ofadvancing missile capabilities by or a mis-sile strike from an isolated, alienated andantagonistic Iran. Some observers, especiallythose in Iran and Russia, argue that the jus-tification for the programme was eliminatedby the Joint Comprehensive Plan of Action(JCPOA) agreement, signed on 14 July2015, which placed limits on Iran’s nuclearand ballistic missile programme in return forthe phased lifting of international sanctions.These arguments frequently site President

Barack Obama, who said in 2009: “If theIranian threat is eliminated, we will have astronger basis for security, and the drivingforce for missile defence construction inEurope will be removed.”

Such benign assessments are prematureand optimistic, a point a US Department ofState official effectively made to IHS Jane’son 16 July 2015, two days after the JCPOAagreement was signed. He said: “Iran hasthe largest inventory of ballistic missiles inthe Middle East, which continues to be asource of concern to us and the internationalcommunity.” Trust between the US/Europeand Iran remains low, and fundamental dis-agreements remain over the future of Iran’snuclear and missile capabilities.

These capabilities have progressed inrecent years. Reed Foster, an IHSAD&S con-tributor responsible for the IHS Jane’s MiddleEast and North Africa capability assessments,noted: “The advancement and growth of anoffensive missile capability has allowed Iranto maintain a credible threat to its potentialadversaries, primarily regionally, but increas-ingly beyond, as Iranian missile technologycontinues to extend the envelope of weaponsrange, accuracy and reliability.”

Foster added: “Iranian rocket and missilecapabilities are oriented toward ... over-whelming regional rivals’ missile defencecapabilities with short-to-medium rangeballistic missiles, anti-ship missiles as well asvarious long-range rockets launched frommultiple sea-and shore-based platforms.”

Recent development efforts have extend-ed the range of several ballistic missile pro-grammes well beyond the vicinity of theimmediate Persian Gulf. The recently-testedEmad, has an estimated range of 1,700kmwith a payload capacity of 750kg; late-se-ries Qadr F- and H-series variants possessa range in excess of 1,700-2,000km with a750kg payload; and solid-propellant Sejil-2

current and future threatsSince Russia annexed Crimea and invaded eastern Ukraine in early 2014, NATO and someEuropean states have renewed their focus on the diverse, dynamic and durable threat toEurope and the evolving missile defence landscape that it has precipitated

The resolution of thenuclear issue does not obviatethe need for ballistic missiledefences to counter the Iranianballistic missile threat



two-stage ballistic missiles have a range ofup to 2,200km with a 750kg payload. Theseall have the capacity to threaten or strikeEurope in response to real or perceivedthreats against the Islamic Republic, as wellas to hold European assets and infrastructureat risk in times of crisis. Foster also believesadvancements reportedly made in re-entryvehicle technology would also indicate thatIran seeks a weapon that could potentiallypenetrate the defences of a state with mod-erate to advanced air-defence technologies.

The Iranian missile challenge to Europe iscomplicated by what Foster calls “unconven-tional and asymmetrical warfare doctrine”.Rapid saturation attacks with short-to-me-dium range guided missiles or rockets uponnaval or commercial shipping vessels, portfacilities, urban population centres or offshoreenergy infrastructure remains a cornerstoneof IRGC Navy doctrine and are reflective ofIRGC approaches more broadly to imple-menting the full suite of its asymmetric capa-bilities. Should such tactics be exported to theMediterranean during any potential conflict,even modest tactical success would likelyresult in significant psychological and eco-nomic impacts in Europe.

Beyond its development of weapon sys-tems, Iran is also suspected of actively sup-porting the export of missile technologyand employment to further empower proxyforces aligned to its geopolitical aspirations,such as Lebanese Hizbullah. Missile technol-ogies ranging from the pervasive 122mmKatyusha rocket artillery possessing a rangeof 20km to the more advanced Iranian-man-ufactured 75km Fajr-5 systems have beenused by Hizbullah against Israel in variousconflicts over the past decade.

Although Europe is unlikely to be con-frontedwith the thousands of stockpiledmis-siles that induced the rapid development andfielding of Israel’s Iron Dome and David’sSling systems, European states remain vul-nerable to these types of asymmetric attacks,especially during times of crisis.

The threat from RussiaThe missile threat to Europe goes well-be-yond Iran’s missiles and proliferation tech-nologies to state and non-state actors. Thethreat from Russia is real and current and is a

phase ii of the European phasedadaptive approach (EpAA) to

missile defence saw sm-3 Block iBinterceptors (here launching froma ship) deployed in Aegis Ashore

batteries in Romania in 2016.

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powerful driver of the ongoing discussion ofmissile defence in Europe.

NATO has resisted publically high-lighting the missile threat from Russia as ajustification of the continued developmentand deployment of EPAA. Such a state-ment would have destabilising effects on the(admittedly already taut) US/NATO rela-tionship with Russia. In addition, it wouldplay directly into the post-Yeltsin Russiannarrative of a rapacious US and West pre-occupied with targeting, provoking anddiminishing Russia as part of an inexorablemove east to tame, subsume or defeat theRussian state. Olga Oliker, director of theRussia and Eurasia programme at the Cen-ter for Strategic and International Studies inWashington, captured this mind-set in aninterview with the Christian Science Monitorin August 2016. He said: “The Russians areterrified of us. They see themselves as push-ing back against US hegemony – and theyreally do see this, this isn’t just rhetoric.”

Nonetheless, the prominent and coercivedisplays of Russia’s military strength, its risk-prone foreign policy, bellicose rhetoric andeven structural state weakness are drivingnational and multi-national developmentand modernisation of varying tiers of missiledefence systems in Europe.

negative responseRussia’s response to the EPAA and to layeredmissile defence programs popping up acrossEurope has been strongly negative. Theinterplay between European missile defenceand Russian rhetoric has had an escalatoryeffect on the US/NATO-Russia competi-tion in Europe and beyond.

Russia objects to the EPAA (and Europe-an missile defence more broadly) as a directand proximate threat to Russian security.Russia also views the EPAA as an effort tofundamentally upset the strategic balance inEurope by, first, seeking to abrogate Russia’sstrategic nuclear deterrent and, second, bystarting a spiralling arms race to escalate ten-sions between the West and Russia and helpdelay geopolitical transitions away fromWestern-led institutions.

These connected sentiments were cap-tured in a July 2016 essay by Sergei Kara-ganov, an influential Russian scholar and

advisor on security issues to President Putin.Dr Karaganov wrote: “By placing missiledefence systems in Europe, theWest is sort ofinviting Russia to withdraw from the (INF)treaty and deploy missiles that can destroythese systems almost instantly. This wouldcomplete the picture with a new edition ofthe missile crisis of the late 1970s and early1980s and a new round of structured militaryand political confrontation in Europe.”

There is no current evidence that theEPAA (or any other system currently underconsideration by individual European states)would threaten Russia’s strategic inter-conti-nental ballistic missile deterrent. The cancel-lation of Phase IV of the EPAA was designed– implicitly if not explicitly – to reassure Rus-sia that this was not an objective of the pro-gramme. Moreover, a 2015 RANDCorpora-

tion report asserted that research and simu-lations showed: “The restructured EPAA sys-tem does not pose a threat to Russian ICBMs.The interceptors at Deveselu (Romania) arenot capable of reaching Russian ICBMs. Inaddition ... when real-world, operationaltime delays are imposed the (SM-3 Block II)interceptors at Redzikowo (Poland) have nocapability against Russian ICBMs.”

Unsurprisingly, the Russian governmenthas not been assuaged by these assurances andcontinues to see the system as a compellingthreat to Russian national security and thebroader strategic balance between the US/NATO and Russia. At the root of this per-ception is a sense that the current iteration ofthe EPAA system is simply an early versionof a more robust future capability, including,potentially, an offensive capability, that will

pose a more pronounced challenge to Russiansecurity and could violate the IntermediateNuclear Forces (INF) treaty. After the com-pletion of the Romania Aegis Ashore site inMay 2016, President Vladimir Putin said: “Atthe moment the interceptor missiles installedhave a range of 500km, soon this will go upto 1,000km, and, worse than that, they can berearmed with 2,400km-range offensive mis-siles even today, and it can be done by simplyswitching the software.”

modernisation and coercionIn 2010, Russia began the State Armaments2020 Program (SAP 2020), a massive effortto recapitalise around 70 per cent of Russia’sarmed forces by 2020, including modernisa-tion and upgrading of Russia’s missile forces.The programme originally allotted $600bnover 10 years, plus between $50bn-$100bnto upgrade the defence industry, accordingto IHS Jane’s Navigating the Emerging Mar-kets: Russia. The figures have been reviseddownward considerably and timelines havebeen extended. IHS Jane’s estimates the newvalue of the investment at $350bn and thecompletion of the programme moved out to2023, largely due to the combined effect ofsanctions and lost revenues emanating fromthe volatility of the energy market.

Still, SAP 2020/23 is still investing incapabilities, many asymmetric in nature,that leverage the strengths of Russia’s indus-try, are relatively cheap to build and deploy,and, according to Dr Stephen Blank, asenior fellow with the American ForeignPolicy Council, can have an outsized dis-ruptive effect on Western military capabil-ities. Tactical ballistic missile systems, suchas Iskander M, RS-24 and Bulava, and stra-tegic ballistic missile/strike systems – RS-26Rubezh, RS-28 Sarmat, Project 4202 – wereidentified as priority categories of capabili-ties in which to invest, as were S-400 andS-500 air and missile defence systems.

That this investment in strike capacitycoincided with the start of the finalisation ofthe EPAA is not a coincidence. In a January2015 Jane’s Intelligence Review article “Russiaupgrades its missile arsenal”, IHS Jane’s ana-lyst Sean O’Connor noted: “The upgradeprogrammes currently under way withinRussia’s strategic nuclear forces are in part

At themoment theinterceptor missiles installedhave a range of 500km, soonthis will go up to 1,000km, andworse than that, they can berearmed with 2,400km-rangeoffensive missiles even today,and it can be done by simplyswitching the software



designed to offer new capabilities to counterUS anti-ballistic missile (ABM) systems inEurope without violating the letter of theIntermediate Nuclear Forces (INF) treaty.”

In addition to strategic and tactical bal-listic missile programmes, Russia has, since2004, invested in a hypersonic weapons pro-gramme known as Project 4202. Hypersonicglide vehicles travel at speeds between Mach5 and 10. Dr Blank said: “[They] use sophis-ticated technologies for manoeuvring andboost that allow them to deliver warheadsrapidly, evade defences and target precisely.”

Russia is not the only country with ahypersonic weapons programme – the USand China have relatively mature projects –but Dr Blank believes Project 4202 is partof an effort to reinforce Russia’s strategicnuclear deterrent, saying that the projectis part of an “obsession – not too strong aword here ... to build supposedly invulner-able nuclear weapons, like hypersonics, thatcannot be attacked by missile defences.”

The capability is not expected to bedeployed until possibly the early-to-mid2020s, but clearly it is conceived of as anoth-er asymmetric means of bypassing Europeanmissile defence efforts and holding the Westat risk. Boris Obnosov, director of the state-run Tactical Missiles Corporation, which isdeveloping the Yu-71 hypersonic glide vehi-cle, told Russia’s state news agency Sputnikin August 2016: “It’s obvious that with suchspeeds – when missiles will be capable of fly-ing through the atmosphere at speeds of seven

to 12 times the speed of sound, all [air] defensesystems will be weakened considerably.”

Russia’s enhanced missile and advancedcapability programmes are also leveraged todeter and intimidate. For example, in May2016, Russia announced it would deploythe Iskander M mobile short-range ballisticmissile permanently to the exclave of Kalin-ingrad later this decade. The missile has beendeployed to Kaliningrad twice previously,but only in support of exercises. The movewas ostensibly in direct response to the open-ing of the first Aegis Ashore site in Romania,though many observers believe the Iskanderwould have been deployed to Kaliningradregardless. For NATO, and especially theBaltic States and Eastern European allies,the announcement was provocative. With arange of up to 500km, all of the neighbour-ing Baltics, Poland – including Redzikowo,the site of the second Aegis Ashore system– and parts of Germany will be within rangeof the nuclear-capable SRBM. Fears thatthese states could become isolated and vul-nerable are drawing a bold line under per-ceptions of the need for more robust missiledefence capabilities and reinforcing the dif-ficult to escape security dilemma unfoldingin Eastern and Northern Europe.

Russian decline and durabilityRussia’s perceived strength demonstratedthrough its assertive foreign policy, militarymodernisation and advancement of its mis-sile capabilities is driving the intensity and

urgency of Europe’s perception of the Russianthreat. But it could be that underlying Russianweakness – demographic, educational, eco-nomic, civil society, political, in innovation –will ensure the durability and unpredictabilityof this perceived threat and the propensity forRussia to pursue risk-burdened and aggressivepolicies to distract or slow decline.

S Enders Wimbush, a long-time Russia/Eurasia analyst, SAFS Centre senior asso-ciate and director of the Russia in Declineprogramme at the Jamestown Foundationin Washington DC, has been examining thesignposts and possible implications of struc-tural Russian weakness. According to Wim-bush: “Evidence of Russia’s decline acrossevery aspect of its power and authority isvoluminous and compelling, and seasonedanalysts in both the West and Russia itselfare turning their attention increasingly to thekinds of dynamics decline could produce andpossible contingencies flowing from thesedynamics. Most Western policy makers anddefense and security planners are stuck in theRussia-as-normal-country paradigm, but thisceased to be the case long ago.”

Crucially, this weakness will engenderbehaviours that pose persistent challengesto Europe and the US over time, includ-ing using current and future air and missilecapabilities to confront the West in Russia’s“near abroad”. To Wimbush, “a decliningRussia which must take more risks to remaincompetitive is a serious challenge” for Euro-pean and US security.n

Phase TimiNg DesCriPTioN ComPoNeNTsPhase i 2011 n Deployment of Aegis ballistic missile defense capa-

ble ships based in Rota, Spainn Deployment of AN/TPY-2 radar deployed to Turkeyn Command, control, battle management and com-munications upgrades to Ramstein, Germanyn Aegis ballistic missile defence ships

n SM-3 Block IA interceptorn AN/TPY-2 radarn C2BMC upgradesn Designed to defend against short- and medium-range missiles

Phase ii July 2016 n Deployment of Aegis Ashore at Deveselu, Romania n Aegis combat system BMD 5.0n SM-3 Block IB interceptorn Designed to defend against short- and medium-range missiles

Phase iii Anticipated in 2018 n Deployment of Aegis Ashore in Redzikowo, Polandin 2018

n Aegis combat systemn SM-3 Block IIB interceptorn Designed to defend against medium- and intermediate-range missiles

Phase iV Cancelled inMarch 2013

n Originally designed to provide a longer-range ca-pability to intercept intercontinental ballistic missiles(ICBMs)

n Aegis combat system in Deveselu, Romania and Redzikowo, Polandn SME-IIB missilesn Designed to defend against intermediate-range and intercontinentalballistic missiles

AcTiVE And AnTicipATEd ElEmEnTs of THE EuRopEAn pHAsEd AdApTiVE AppRoAcH (EpAA)



The missile threat to Europe is multi-di-mensional and omnidirectional. NATOstates will rely on the European Phased

Adaptive Approach (EPAA) to meet the medi-um- and intermediate-range ballistic mis-sile threats, but NATO members – as well aspartners and non-members – are increasinglyeither actively seeking or investigating alterna-tive national or regional solutions to meet thelow-tier air and missile threats, as well as short-range air defence (SHORAD) and very short-range air defence (VSHORAD) missions.

As procurement competitions unfold inplaces such as Poland, Germany, Lithuania,Spain, the Netherlands, Romania, the CzechRepublic, Georgia, Switzerland and Sweden(among others), they are revealing criticalinsights about the emerging competitivedynamics, future parameters and trajectoriesof what will be a very active market over thenext five to 10 years. Four deals are partic-ularly useful in understanding current andemerging market dynamics, procurementpriorities and capability requirements.

Germany: TlVsIn June 2015, Germany announced thatit had chosen to move forward with theMedium Extended Air Defence System(MEADS) International consortium (led byMBDA and Lockheed Martin) to meet itsTaktisches Luftverteidigungssystem (TLVS)ground-based air defence system require-ment. MEADS was chosen to replace Ger-many’s Patriot air defence systems, original-ly fielded in the 1980s. Stated procurementrequirements include: a fully-hemispherical360-degree coverage; an open architectureto ‘plug in and fight’; increased mobility,especially in terms of air transportation bythe air force’s A400M airlifter; as well asreduced crew and life-cycle costs.

The MEADS programme promisedenhanced capability to meet longer-range

and diverse threats through the implementa-tion of the Lockheed Martin PAC-3 MissileSegment Enhancement (MSE) missile, theMultifunction Fire Control Radar (MFCR– an X-band, solid-state, phased array radarusing element-level transmit/receive mod-ules developed in Germany), the MEADS360-degree ultra-high frequency (UHF)active electronically steered array radar,and MEADS BMC4I Tactical OperationsCentre. For the TLVS program, MEADShas proposed to augment PAC-3 MSE withDiehl’s IRIS-T-SLS as a notional low costmedium-range interceptor solution.

MEADS is still being developed, andGermany plans to continue to operate Patri-ot systems well into the next decade. Esti-mates for fielding the TLVS capability rangefrom “around 2030”, according to GeneralMichael Grossmann, director of ground-based operations at German Air Force, to aJune 2016 Jane’s Defence Weekly assessmentof “about 2025”.

The deal underscores three notable mar-ket dynamics and potential emerging pro-curement priorities.

First, the estimated €4bn ($4.5bn) deci-sion is a significant opportunity for theMEADS programme to establish itself inthe highly-competitive international exportmarket after a somewhat mixed history since2011. The MEADS programme was formal-ly established through a 2004 Memorandum

of Understanding (MoU) between the US,Italy and Germany, with the intention ofdeveloping a novel system capable of meet-ing threats from tactical ballistic missiles,cruise missiles, unmanned aerial vehiclesand aircraft. MEADS suffered a setback in2011when the US Army ceased its partici-pation in the programme, instead optingcontinued investment in Raytheon’s Patriotsystems. MEADS was subsequently restruc-tured, enabling all three countries to harnessand leverage the technology following the2013 demonstration phase. Finalising theTLVS contract could serve as the life-linefor the program, especially given the influ-ence that the German defence market canhave on many of its neighbours.

Second, the TLVS procurement is alsonotable because it is among the first majorprocurements in which the German gov-ernment is employing a new process to limitgovernment risk to cost overruns and delayeddelivery. To retain the contract, MEADSmustmeet six milestones along what Rick Edwards,executive vice-president of Lockheed Martin’sMissile and Fire Control division, referred toat the ILA 2016 exhibition in Berlin in June as“an ambitious timeline”. “Lockheed Martin is100 per cent committed to the success of the[TLVS-MEADS] programme and our part-nership with MBDA,” Edwards said.

A defence analyst speaking to IHS Jane’safter the 2015 award, said German DefenceState Secretary Katrin Suder “has initiateda change of paradigm” in German defenceprocurement to help mitigate risk. “The tac-tical air defence system is the first procure-ment programme based on firm milestoneswith an opt-out option in case the mile-stones are not met. It is against this back-ground that the defence ministry will keepin contact with Raytheon, which offeredan enhanced Patriot version. The MEADSConsortium has been given to understand,

national missile defences in Europe

The TLVS is among thefirst major procurements inwhich the German governmentis employing a new process tolimit risk to cost overruns anddelayed delivery

The way in which Germany, Poland, the Netherlands and Lithuania are bolstering theirair defences provides a valuable insight into how current and emerging market dynamics,procurement priorities and capability requirements are developing



that the opt-out clause is for real,” the analystsaid. In a highly competitive market requir-ing heavy investment, a government’s abil-ity to play competing companies and theirsystems off one another, even after awardinga contract, could become a common way tohelp them drive down costs and gain a morereliable capability within a faster timeline.

It is already happening to a degree in Ger-many and, to a lesser extent in Poland, twocompetitions that demonstrate the “glovesoff” nature of the air andmissile defence com-petitions in Europe. During ILA 2016, Ray-theon announced that it is in renewed discus-sions with Germany to potentially resubmitits Patriot ground-based air defence systemfor TLVS in case MEADS fails to meet themandated milestones. Lockheed Martin andMBDA pushed back against the statement,responding that MEADS was on-course tomeet the TLVS stated requirements. Theexchange and continued engagement of bothfirms after award indicates the accelerating

competitive dynamics in this market as allcompanies seek to either establish or expanduser communities within Europe.

Third, the deal reflects the challengesassociated with costs of advanced air andmissile defence systems generally and stilldeveloping systems, in particular. MBDADeutschland submitted its proposal for thedevelopment of TLVS to the German Fed-eral Office of Bundeswehr Equipment,Information Technology and In-ServiceSupport on 28 September 2016. The orig-inal goal was for MEADS and the Germangovernment to sign a contract in the firsthalf of 2017 based on this proposal.

This timeline may be in jeopardy. Report-ing from Reuters in October 2016 – citing“multiple sources familiar with the proposal”– indicated that the proposed MEADS costwas higher than anticipated. IHS Jane’s ana-lysts interviewed for this paper were unableto confirm Reuters’ report, but did note thatthe cost of PAC-3 Missile Standard Exten-

sion interceptor was high and that, while theMEADS system has demonstrated capabilitiesin live simulations, the system still requiresfurther development before being fielded thatcould also add previously unanticipated cost.

The German government has notresponded directly to the report, comment-ing only that it is still evaluating the pro-posal. If contract signature pushes beyondmid-2017, it could conceivably be delayedfurther by Germany’s federal elections,between late August and late October 2017.

poland’s shieldOn 21 April 2015, just weeks before Ger-many’s TLVS announcement, then-Pol-ish president Bronislaw Komorowskiannounced that Raytheon’s Patriot missilesystem had been selected for the country’sWisla medium-range air- and missile-de-fence (AMD) system. Patriot was chosenover Eurosam’s SAMP/T system in the finalround of the competition.

patriot missile batteries were deployed in Romania during a joint training exercise with the us on 7 november 2016

Photograph

y:Tech

SgtB

rianKimball/DoD

/Flickr



After over 15 months of discussions,the Polish government confirmed it wouldmove forwardwith the procurement of eightof the latest Patriot (Configuration +3) sys-tems on 6 September 2016 at Poland’s annualMPSO defence exhibition. All eight batteriesare expected to be delivered by 2025. ThePatriot systems will replace Poland’s exist-ing air-defence capabilities based on ageingSoviet-designed equipment. Estimates of thecost range from around $3bn-$5.6bn.

The award is a significant developmentfor the Patriot system in a competition thathad taken on increased urgency and politicalsignificance in the context of the Crimea andUkraine crises and rising tensions betweenNATO and Russia.

The deal calls for the phased delivery ofprogressively advanced capabilities. The firsttwo Patriot batteries will be “interim stan-dard” of the Patriot (Configuration +3) andwill be delivered in 2019. Two batteries fea-turing Raytheon’s next-generation galliumnitrite (GaN) AESA 360-degree radar – akey requirement of the competition – areexpected to be delivered in 2022. Four moresystems will be delivered by 2025 at whichpoint the two interim standard versions willbe upgraded to the Wisla standard, accord-ing to IHS Jane’s.

The procurement also calls for the incor-poration of an open-architecture design thatwould allow for full operational compatibilitywith the Northrop Grumman Integrated Bat-tle Command System (IBCS), further stressingthe need for open architecture and the capac-ity to integrate new capabilities into existingsystems. According to IHS Jane’s reporting inSeptember 2016, the IBCS system is not yet inservice, thought it has successfully completedtest firings. It is not currently exportable.

Another core component of the agreementis extensive industrial co-operation betweenRaytheon and the Polish defence industry.Raytheon has already signed agreements withPGZ, Poland’s national defence industrialconsortium, to build the identification friendor foe (IFF) modules for the AESA radars.Raytheon is also collaborating with Polishindustry on the development and productionof the SkyCeptor low-cost interceptor, oneof four interceptors – PAC-2 GEM-T, PAC-3 and PAC-3 MSE are the others – offered

as part of the procurement. SkyCeptor willleverage the Raytheon/Rafael Stunner missiledesign, though SkyCeptor will have somecharacteristics specially designed for the Polishthreat environment, such as low-observability.Polish industry will be responsible for 50 percent of the missile’s production.

The Wisla procurement constitutes thelow-tier component of Poland’s plan for alayered air and missile defence system knownas Poland’s Shield. Poland is still consideringoptions for theNarew programme, whichwillbe designed to address short-range threats.Longer-range threats will be addressed byland-based Standard Missile-3 Blocks IB andIIA Aegis Ashore interceptors based at Redzi-kowo from 2018, as part of EPAA Phase III.

MEADS was originally eliminated priorto the downselect to SAMP/T and Patri-ot, but renewed discussions with the PolishMinistry of Defence in February 2016, near-ly a year after the original Patriot announce-ment. While the discussions did not lead toa Wisla award, MEADS reportedly remainsa candidate for the Narew procurement.Kongsberg’s Norwegian Advanced Surface-to-Air Missile System (NASAMS), Barak 8(also being offered for a Polish Navy require-ment), Iron Dome/SPYDER, MBDA’sMICA-VL and Diehl’s IRIS-T-SLS are alsocontenders, according to IHS Jane’s analysts.

netherlandsIn October 2016, the Netherlands chose toupgrade its Patriot systems with the ModernManStationuser interface.Thedeal guaranteesthat Dutch Patriot systems will be operation-al out to 2040. According to Robin Hughes,editor of IHS Jane’s Missiles and Rockets, a keydiscriminator in the procurement was Raythe-on’s ability to offer theNetherlands a completere-capitalisation of their Patriot systems due tofunding received from “Patriot sales to SouthKorea and the UAE”, highlighting the valueof large user communities in defraying costs ofsystem upgrades.

The Netherlands currently fields the PAC-3 and PAC-2 ABM missiles for its system andis also considering procurement of a low-costinterceptor such as Stunner/SkyCeptor orDiehl’s IRIS-T. Some reports indicate Lock-heed Martin’s PAC-3 MSE is also being con-sidered for the Netherlands’ Patriot batteries.

lithuaniaLithuania’s decision to acquire two batteriesof the Norwegian Advanced Surface-to-AirMissile System (NASAMS) from Norway inOctober 2016 demonstrates the urgent per-ceptions of the Russian threat in the Baltics.It also serves as a catalyst for discussion of aBaltics-wide air and missile defence systemor new operational concepts for the deploy-ment of low-tier integrated air and missiledefence systems from other NATO states.The NASAMS systems are expected to bedelivered in 2020 and, according to Jane’sDefence Weekly, will “offer a step-changein air defence capability for the LithuanianArmed Forces”. Latvia is also reported-ly receiving older NASAMS systems fromNorway, and multiple IHS Jane’s analystshave suggested that over the next few yearsthe Baltic States may consider “clubbingtogether to buy a true medium-to-longrange (70km+) air-defence system, such asthe Patriot”, according to recently publishedanalysis fromNick de Larrinaga, Europe andCIS editor at Jane’s Defence Weekly.

While the costs of advanced missiledefence systems are notoriously high, cir-cumspection of Russia in the Baltics has driv-en dramatic rises in defence budgets acrossthe region that could enable such a com-bined procurement of an advanced system.Craig Caffrey, principal analyst on IHS Jane’sDefence Industry and Budgets team notedin October 2016 that “the profile of defencespending [in the Baltics] has changed dra-matically in the last two years. Their defencebudgets will all be over 2 percent of GDP by2018, and each country will have doubled ortripled their budgets from 10 years ago. In2005, the region’s total defence budget was$930m. By 2020, the region’s defence budgetwill be $2.1bn. This growth is faster than anyother region globally.”

Even if such a procurement does not hap-pen, or alternatively if an enhanced air andmissile defence requirement becomes moreprominent in the short-term, other NATOnations may choose to deploy their ownnational systems to the Baltics. In fact, Ger-many and the Netherlands have discussedthis contingency as part of their ongoingPatriot interoperability program known asProject Apollo. n



T he missile-versus-missile defencecompetition is among the most acuteexamples of the cost-imposing chal-

lenges of the diffusion of advanced military,commercial and dual-use technology. Thecosts of resilient, adaptive and layered missiledefence systems are considerablymore expen-sive to develop, test and maintain than thecost of developing a viable cruise and ballisticmissile threat. One IHS Jane’s expert referredto the cost for the highest-end interceptorson the market today as “eye-watering”.

Emerging low-cost-of-shot/deep-maga-zine solutions, such as directed energy andhyper-velocity projectiles fired from navalpowder guns, operational concepts (left-of-launch interventions, for example) andcompetitive strategies designed to mini-mize the need for intercepts in the first placeoffer some promise in changing current costcurves. However, these capabilities and con-cepts are not yet mature, and the path fromconcept to deployment of new technologiesand concepts is longer, harder and moreexpensive than fully appreciated when con-cepts are being initially trialled or explored.Expensive kinetic interceptors will remainthe anchor of the missile defence solutionswell into the next decade.

Within the European context, the bud-getary environment has improved since thelow point of 2014 when IHS Jane’s DefenceBudgets assessed that NATO accountedfor 12 of the 20 fastest declining defencebudgets in the world. As captured in thecharts below, spending across most of thecontinent is increasing, especially in East-ern Europe and the Baltic States. Indeed,Chris Lombardi, vice-president for Euro-pean Business Development at Raytheon,told IHS Aerospace, Defence and Security thathe had seen a “very strong recent push bycountries and leadership to increase budgetsand develop solutions to meet the expandingthreat environment.”

Even with these budget increases, costwill remain an important – though not nec-essarily prohibitive – factor in the procure-ment of air and missile defence programmesas states across the continent grapple withhow best to prioritise spending in a fullthreat environment. Even in countries suchas Poland, where the sense of threat is largelyfocused on Russian activity and capabilities,analysts believe the expanding requirementsare outpacing expanding budgets. As IHS

Jane’s contributor Reuben Johnson pointedout in his Jane’s Defence Weekly coverage ofthe September 2016 MSPO defence exhibi-tion in Poland. He wrote: “The projectedcost of all the systems Poland plans to pro-cure is more than twice what the country’sFinance Ministry has projected in terms offuture tax revenues.”

The result of this tension is a market thatis still active, but will need to be responsiveto evolving and expanding air and missilethreats while also seeking to manage poten-tially spiralling costs of layered, interoper-able, adaptive, and flexible air and missiledefence systems.

Procurement of air and missile defencesystems is not the only cost end-user com-munities incur, of course. Operating andmaintaining these systems is a concernto end-user communities, particularlycosts associated with transporting systemsto where they are needed, training pro-grammes, exercises, upgrading to incorpo-

rate new generations or capabilities, depotmaintenance and the manpower to actuallyoperate a system.

layers and interoperabilityA recurring theme throughout this paper isthe need for layered air and missile defencesystems. From Israel, UAE and Qatar toSouth Korea and Japan to Poland, Germa-ny, Romania and the Netherlands, defencecommunities are investing in multiple sys-tems to optimise existing capabilities andensure redundancy against multiple threatsalong multiple axes and from multiple direc-tions at multiple speeds and traveling multi-ple distances.

However, developing and deployingmultiple layers of missile defence is notcheap or easy, placing a premium on highdegrees of integration of and interoperabil-ity in and among various layers in nationaland multi-national systems. This frequentlyrequires the enhancement of open architec-tures – an increasing requirement for missiledefence systems across Europe – that allowfor “plug-in and fight” interoperabilitybetween multi-national systems or, even,as with the Poland Wisla procurement,between different missile defence compo-nents manufactured by different companies.

Bi-lateral and regional collaborationefforts are ongoing. For example, in October2016, Germany and the Netherlands test-ed joint operations of their Patriot systemsduring an exercise off the coast of Crete,as a part of a programme known as Proj-ect Apollo. During a speaking engagementat the European Integrated Air and MissileDefence Conference in London in Febru-ary 2016, Brigadier General Michael Gross-mann, director of ground-based operationswith the German Air Force, noted that theprogramme could be a model for multi-lat-eral deployments to Poland or the BalticStates in the future. According to Brigadier

concepts, tensions and requirements

Expensive kineticinterceptors will remain theanchor of the missile defencesolutions well into thenext decade

Threat and market environments are challenging end-users and air and missile defencesystem manufacturers as they seek to balance the key concepts, tensions and emergingrequirements shaping the future of European defence



General Grossman, the programme is “alsohoping to open up Apollo to other Euro-pean countries to allow them to bring theircapabilities to the project”.

But the appropriate and admirable ambi-tion of Project Apollo should be temperedto a degree by the recognition that achiev-ing an operationally effective bi-lateral ormulti-lateral “plug-in and fight” interoper-ability can be a complicated task.

In October 2015, eight member nationsof the Maritime Theatre Missile DefenseForum held the At Sea Demonstration 2015(ASD 2015) exercise on the Hebrides Rangeoff the coast of Scotland. The “landmark”exercise was first multi-national IntegratedAir and Missile Defense (IAMD) test and,according to Richard Scott, IHS Jane’s Navalcontributor, “the most technically complexnaval live-firing event ever attempted inEurope.”

The exercise achieved several tactical andoperational successes, but it also exposedpersistent challenges related to “plug-inand fight” interoperability and establish-ing robust network links for real-time tac-tical data exchange. At the MAST 2016conference in Amsterdam in June 2016,Commander Andreas Ulm, ballistic mis-sile defence project officer in the GermanNavy headquarters and ASD15 chief of staff,noted: “I didn’t fight the enemy most of

the time, but I fought our interoperabilityissues.” Commander Ulm continued: “WhatASD15 proved to me was that ‘plug-in andfight’ is just a dream, unless you are on anAegis destroyer in a well worked–up Aegistask group ... But again, it was not ‘plug-inand fight.”

immediate threatThe air and missile defence threat fac-ing Europe is neither notional nor distant.Enhancement, development and prolifer-ation of air breathing and ballistic threatsis happening now and are playing a moreconsequential role in intensifying regionalgeopolitical competitions, especially withRussia.

Developing, acquiring and deployingindividual systems – much less layered sys-tems – takes years. The TLVS (2025-30),Wisla (2019 before the initial Patriot isdeployed, 2025 before the final system isactive), and the Lithuanian NASAMS pro-

curement (2020) all progressed in the 2016strategic context, but are unlikely to befielded until next decade, creating a poten-tially destabilising imbalance between theimmediacy of a more robust threat and theability of states in Europe to field the rightcapability to directly address the threat andavoid coercion, manipulation or a kineticstrike in a time of crisis.

Some of this potential vulnerability hasbeen met through the signing of procure-ment and/or upgrade deals with “namebrand” US and European suppliers withproven capabilities that will shorten thesewindows of strategic vulnerability. Thiswas almost certainly a powerful consider-ation in Poland’s decision to move forwardwith Patriot for its Wisla requirement. As adefence analyst based in Warsaw noted toIHS Jane’s after the April 2015 announce-ment of Patriot’s selection, “after Raytheon’sbusiness development team, the person per-haps most responsible for Raytheon’s winin Poland is Vladimir Putin. Otherwise thePoles might have been willing to go withanother system with a longer procurementtimeline that allowed them to be involved inthe design from the ground up.”

One important caveat: a key discrimina-tor for all industry seeking to be successfulin the European air and missile defence mar-ket, especially in states seeking to upgrade

What ASD15 proved tome was that ‘plug-in and fight’is just a dream, unless you areon an Aegis destroyer in a wellworked–up task group ...

EAsTERn EuRopE dEfEncE ExpEndiTuRE2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Poland 7,449 7,715 7,365 8,295 9,852 9,181 9,391 9,758 10,147 10,488

greece 3,538 3,423 3,742 3,102 2,862 2,718 2,660 2,676 2,706 2,736

romania 2,076 2,031 2,092 2,648 2,662 3,083 3,480 3,925 4,147 4,266

Ukraine 1,023 1,226 1,098 1,699 2,332 2,427 2,379 2,348 2,353 2,378

Czech republic 1,804 1,762 1,680 1,638 1,686 1,829 2,027 2,246 2,496 2,766

hungary 1,019 972 932 934 947 1,108 1,161 1,210 1,310 1,423

slovakia 788 830 759 787 921 918 959 995 1,035 1,077

Croatia 733 664 664 591 589 583 572 591 614 639

Bulgaria 558 547 604 570 538 623 680 668 662 706

serbia 751 512 527 544 493 484 482 494 517 550

Lithuania 302 293 306 327 446 599 680 740 790 841

estonia 322 381 389 405 430 468 481 491 500 518

slovenia 501 375 369 355 344 363 353 366 379 396

Latvia 246 259 256 236 265 384 486 597 614 630

ToTaL 21,111 20,991 20,782 22,132 24,365 24,768 25,791 27,104 28,271 29,414

Source: Jane’s Defence Budgets



old Soviet equipment and improve domesticindustry in the process, will be the capacityof firms to partner with and provide mean-ingful workshare to local industry in procur-ing states and maintain a viable supply chainacross Europe. Poland’s Wisla procurementincluded an extensive role for Polish indus-try in the co-development of the SkyCeptorLCI and GEM-T missile systems and in theproduction of ancillary system, such as con-tributions to wheeled vehicles, for the Patri-ot systems.

But industry engagement adds a layerof complexity to closing the gap betweenthreat and capability that could introducerisks for both industry and for end-usercommunities. For industry, the need to havea comprehensive understanding of localindustry strengths, weaknesses, relation-ships, opportunities and challenges and todevelop and operationalise effective strate-gies for engagement of partners and suppli-ers in country is a critical consideration formarket entry. This is especially the case inthe air and missile defence market in which,as discussed above, savvy buyers will havemany options and expect rapid delivery ofreliable capability. Sticking to timelines willbe critical. Many local firms may not be ableto absorb relevant technologies or, alterna-tively, because only some firms can absorbthese technologies they will have relation-

ships with other foreign suppliers on relatedprogrammes. Delays to post-award develop-ment timelines and unintended diffusion ofcritical technologies are both possible.

For end-user communities, even mod-erate delays to timelines can be worrisome,reinforcing the sense of urgency of the needto begin procurement programmes, even ifthe capabilities will not be fielded for anoth-er decade.

Adaptive capabilityIn his remarks initially announcing the USintention to pursue the EPAA in Septem-ber 2009, President Barack Obama said:“Because our approach will be phased andadaptive, we will retain the flexibility toadjust and enhance our defences as the threatand technology continue to evolve.”

The need to affordably augment orupgrade a current system with new technol-ogies and capabilities is not unique to EPAA.It is a central requirement for air and missilesystems at all levels, given the interactive andshifting nature of the competition betweenemerging offensive and defensive air andmissile capabilities and the pace at whichnew technologies and operational conceptsare proliferating.

Some end-user operational requirementsare already known and are influencingrequirements of current and imminent com-

petitions. In addition to the growing interestin open architectures and ability to reduceoperational costs, three additional require-ments stand out as relevant over the next fiveto 10 years.nMissile mixes and low–cost intercep-tors: The cost of kinetic interceptors is oneof the main drivers of the high costs of airand missile defence systems. Not only arethe handful of high-end interceptors on themarket expensive, users frequently need toprocure many of these systems in order toensure adequate redundancy.

But not all threats require high-end inter-ceptors. Using an SM-3 Block IIA or PAC-3MSE against lower-tier, but diffused and stillmenacing, threats, is not an effective wayto optimize air and missile defence invest-ments. A more modular “horses-for-cours-es” approach that enables systems to usea wider-range of missile types to meet awider-range of threat types is one effectivemeans of balancing the need for a flexiblecapability while managing procurement andoperational costs.

The highly-sophisticated technologiesof the kind used on the PAC-3 MSE willbe part of this mix for countries buildingdefences against sophisticated theatre ballis-tic missiles. But air and missile defence sys-tems will be required to be able to accom-modate less expensive systems, such as the

wEsTERn EuRopE dEfEncE ExpEndiTuRE2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

United Kingdom 63,648 62,732 60,968 60,734 60,662 60,945 60,765 60,615 60,673 60,822

France 43,896 44,159 44,924 44,407 44,338 44,877 45,287 45,687 45,866 45,856

germany 35,788 35,718 36,480 35,199 35,906 35,754 37,539 37,208 37,626 38,395

italy 23,612 23,407 24,377 23,601 22,986 23,055 22,253 21,927 22,002 22,299

spain 13,360 12,016 11,043 10,934 10,991 11,008 11,207 11,312 11,402 11,587

Netherlands 9,293 8,816 8,352 8,295 8,443 8,586 8,595 8,464 8,288 8,068

switzerland 6,308 5,993 6,099 6,208 6,125 6,161 6,156 6,178 6,189 6,216

sweden 5,495 5,602 5,533 5,754 5,679 5,687 5,788 5,827 5,987 6,127

Norway 4,777 4,771 4,842 4,878 5,120 5,824 5,937 5,913 5,886 5,836

Belgium 4,180 4,083 4,040 3,805 3,511 3,460 3,467 3,526 3,646 3,782

Denmark 3,633 3,576 3,490 3,297 3,021 2,997 3,043 2,961 2,904 2,972

Finland 3,277 3,174 3,124 2,939 2,826 3,009 3,022 3,022 3,243 3,338

Portugal 2,275 2,267 2,255 2,079 2,060 2,038 2,049 2,071 2,126 2,224

austria 2,319 2,323 2,183 2,084 1,942 2,277 2,322 2,319 2,324 2,322

ireland 1,056 1,017 1,004 999 958 942 908 885 880 863

ToTaL 222,916 219,656 218,713 215,213 214,568 216,620 218,339 217,915 219,041 220,707Source: Jane’s Defence Budgets



GEM-T, and low cost interceptors, such asDiehl’s IRIS-T-SLS and Raytheon/Rafael’sStunner, the model for the made-in-PolandSkyCeptor, which will be used in Poland’sShield Patriot systems.n 360-degree radar: Guided missiles, lowobservable aircraft and the proliferation ofunmanned systems all serve to expand thegeographic range that militaries must plau-sibly monitor for air and missile threats intimes of crisis. Militaries cannot necessarilyassume with a high degree of certainty thenature of attack vectors against them, creat-ing growing demand for fully-hemispheric360-degree coverage for missile defence.

This was a stated requirement for the largedeals unfolding in Germany and Poland. Thestill in-development MEADS system willinclude a 360-degree UHF active electroni-cally steered array radar when it is scheduled tocome online in 2025-30. Neither the currentgeneration of the Patriot nor the SAMP/T sys-tems considered by Poland offered 360-degreecapability. However, the next generationPatriot system selected by Poland will add thiscapability through upgrades and the incorpo-ration of rear panels that utilize “staring” arrays.

Regardless of the particular approach,being able to field a reliable and affordable360-degree capability will be a significantdiscriminator in the market.n Incorporating novel emerging tech-nologies: Perhaps the most notable com-ponent of the AESA next generation Patriotradar offered to Poland is its use of galliumnitride (GaN) one of many novel emergingtechnologies likely to affect the future of theair/strike versus missile defence competition.

According to a September 2015 IHS Jane’sIntelligence Briefing webinar on GaN tech-nologies, the technology provides consider-ably more thermal conductivity than galli-um arsenide (GaAs) as well as higher-power,improved reliability, range and affordability.The technology is particularly relevant tothe radar market as it offers greater powerdensity, improved efficiency and facilitatesthe development of new equipment andupgrades to existing AESAs. IHS Jane’s anal-ysis also stated that GaN would “rejuvenatethe radar market for years to come”.

GaN technology is also now beingincorporated into radars, electronic warfare

and communications systems. Several com-panies, particularly those in the US, nowoffer GaN technologies in multi-role radars,including Northrop Grumman (G/ATOR)and Lockheed Martin (TP-77). Raytheon —which according to Lombardi, has investedover $300m of its own money into GaNresearch – operates the only US Departmentof Defence certified GaN foundry.

GaN is just one – albeit immediately rel-evant – critical technology impacting thefuture of missile defence. There are manyothers. In the diverse, dynamic and dura-ble threat environment described above,industry will be pressured to develop, test

and field new and relevant technologies asthey come available in order to mitigatenew threats and also, potentially, drive themissile-versus-missile defence competitionalong a new trajectory.

customers and user communitiesThe air and missile defence market is alreadyvery competitive and will becomemore so asstates in Eastern Europe and the Baltics seekto upgrade old Soviet equipment and statesin Western Europe look to procure morerobust layered missile defences or upgradeexisting systems to meet new threats.

Companies are increasingly seeing theadvantage of commonality and momen-tum as powerful discriminators in this mar-ket environment and are therefore trying toestablish anchor clients that can open doorsto additional markets, prioritising interop-erability with their neighbours. The end-goal is a chain reaction (or series of them) inwhich successive states linked by proximityand shared threat perception select a similaror complementary capability, ensuring “usercommunities” that help defray operationaland engineering upgrade costs across multi-ple users. As Lombardi noted, one of Patriot’s

main selling points in the current market isthat “operational engineering upgrade costsare shared across a user-community of 14nations – including five NATO members.Common training, similar depot mainte-nance and joint exercises also help reducemanpower and overall operational costs.”

Of course, Raytheon isn’t the only com-pany seeking to develop these communities.Capital Alpha, a firm monitoring defencedevelopments for the financial services indus-try, identified the importance of anchor cli-ents and user communities to both industryand national militaries in its October 2016coverage of an Atlantic Council event on“The Future of US-Swedish Defense Co-op-eration.” The report noted: “Air defense sys-tem commonality with Poland, Sweden andGermany remains an intriguing prospect. It’swhy the stakes remain high for LockheedMartin to have MEADS procured by Germa-ny, as that might also raise prospects for Swe-den. Equally, if Raytheon can keep Poland inPatriot and MEADS proves unaffordable forGermany, it can offer upgrades to existingGerman Patriot unity, and that would alsoenhance prospects for Sweden.”

conclusionEurope’s threat environment is expanding;its geopolitical and political context growingmore complex and competitive. Developingand deploying resilient, robust and affordablecapabilities to address the full spectrum of secu-rity challenges will require a high-degree ofcross-NATO andmulti-national collaboration,co-ordination, commonality and co-opera-tion. It will also require an effective diagnosisand prioritisation of emerging threats. This isespecially the case with meeting air and mis-sile threats and the coercive diplomacy theycan enable. Defence communities and industrymust find means of balancing cost while incor-porating layered, interoperable, adaptable and,critically, demonstrated air and missile defencesystems capable of deterring, dissuading anddefeating the probable and possible threats oftoday, tomorrow and an increasingly anxious,contested and uncertain future. nTate Nurkin, the Senior Director of the SAFSCentre, managed the production of this report.For more information about the SAFS Centre,please visit: www.ihs.com/Info/0116/safs.html

Common training,similar depot maintenanceand joint exercises also helpreducemanpower and overalloperational costs

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Rising tensions - Raytheon€¦ · ing air and missile defence capabilitiesas well,possiblyTHAADortheAegisAshore batteries thathaveformedthe foundation of NATO’s European PhasedAdaptive