After years of watching European allies look east to Russia for weapon buys — or to maintain their Soviet-era systems — the U.S. has a plan: open up a new dollar stream to encourage those nations to buy high-end American defense goods.
The theory is that the European Recapitalization Incentive Program, or ERIP, helps six nations (start to) get off Russian equipment, while increasing the sale of U.S. weapon systems abroad in the process. A win-win, for the United States. But perhaps more complicated for its European allies.
Here’s what I like about this program: We’re investing. The first ERIP tranche would be just over $190 million in reprogrammed fiscal 2017 funding. That obviously helps allies with upfront costs, making participation in the program more feasible. But it also sends a message of support and cooperation to countries that for the last couple of years have suffered attacks from the U.S. administration about failure to invest adequately in defense and the need to carry more of their own weight.
This also gets ahead of a situation like the one the U.S. and NATO allies have encountered with Turkey, purchasing a Russian missile defense system that could compromise security. Yes, the U.S. had offered Turkey alternatives to Russia’s S-400, but they came with certain strings and perhaps too late in the process.
But execution of the program matters. For one thing, how does this meld with the countries’ own long-term defense plans? Are we helping them along, or potentially diverting allies from their own national security strategies? New helicopters like the ones Albania, Bosnia and Slovakia could opt to purchase to replace Russian systems make sense on paper, but only if the number and the type and the cost match up with the anticipated requirements those countries identified for the next decade or longer. Are we persuading countries to buy systems they may not otherwise have acquired because hey, it comes with financial backing from the United States? Or could we even deter them from participating at all, if it lacks the ability for these countries to have an adequate say? Also consider that many of these countries are making consorted efforts to expand their own industrial base. How does pushing U.S. systems align with those efforts?
Also important to consider is the sustainability of the program. While the program does require that participating countries have skin in the game to encourage longer-term investment, it doesn’t fund all future buys or purchases of the same or other systems. Many of these countries are lured to Russian systems, as they are less expensive. Will the countries run back to Russia when, down the road, U.S. system still prove more expensive to maintain or replace? Will these be one-off success stories?
And what about Ukraine? So far, ERIP targets Albania, Bosnia, Croatia, Greece, North Macedonia and Slovakia. Other countries identified as practical fits for the program include Poland, Hungry and the Baltic nations — minus Estonia, which doesn’t operate Soviet-era gear. I’ve seen no mention of Ukraine, probably because it could appear a bit too much like poking the bear to the east. This of course also reflects years of debate about whether supplying Ukraine with arms could make a tense situation worse. (Furthermore, Ukraine’s defense industry arm, Ukroboronprom, is also currently embroiled in a scandal over mismanagement, with some talks of liquidating the state concern entirely. So there’s that.)
Still, in Ukraine you have a country that is more desperate than others for alternatives to Soviet systems. Ukraine is also the ultimate test case — having transitioned from repairing, modernizing and selling Soviet arms, to developing its own. The country has touted in the last year a desire to pursue joint or licensed production of weapons systems using a leasing or offset mechanism. that could perhaps be an approach that could function within the bounds of ERIP to appeal to countries wanting to up their indigenous manufacturing.
So, in ERIP we have an encouraging development, no doubt. But for the program to succeed, the devil just may be in the details.
Jill Aitoro is editor of Defense News. She is also executive editor of Sightline Media's Business-to-Government group, including Defense News, C4ISRNET, Federal Times and Fifth Domain. She brings over 15 years’ experience in editing and reporting on defense and federal programs, policy, procurement, and technology.