Speech on NATO’s Smart Defence Initiative

Ladies and Gentlemen,

I am delighted to be here in Tallin today and to have the opportunity to exchange views with you on NATO’s Smart Defence Initiative.

Please allow me to take the opportunity to thank Mr Martin Hurt (Member of the Executive Board of ICDS - former senior civil servant in the MoD) for organising this event.

With five months to go, we are well on the way to Chicago, where President Obama will welcome Allied Heads of State and Government at a NATO Summit in May next year.

This Summit will be of great importance. It will be an opportunity to demonstrate once again Allied solidarity, the significance of the transatlantic link and NATO’s commitment to maintain peace and security. The main deliverables foreseen for Chicago relate to Afghanistan, Missile Defence, Deterrence and Partnerships - and last but not least capabilities and the Smart Defence Initiative.

Today, my intention is to focus on the capabilities part and outline how we at NATO intend to take forward the Smart Defence agenda on the road towards Chicago.

The rationale for Smart Defence

It was at the Munich Security Conference in February this year that the NATO Secretary General, Anders Fogh Rasmussen, introduced the Smart Defence concept.

The idea is simple. Smart Defence is about nations building greater security with more collaboration and more coherence.

Many Allied countries have been badly hit by the financial crisis. Public spending have been cut. Defence budgets have been cut. Few countries spend enough on defence capabilities. I am pleased that, after the difficulties Estonia has faced, the government has taken the courageous decision - the right decision - to bring defence spending in Estonia up to the level of 2% of GDP from 2012.

The security challenges our nations are facing are numerous and widespread. The events in Libya have underlined that we cannot fully predict what lies over the horizon.

But given the economic environment, we are working in, Smart Defence is the beet forward.

We need to develop, deliver, and deploy modern capabilities in key areas.

And strike a better balance of what is available on both sides of the Atlantic.

Our mission in Libya demonstrated this quite clearly. It was a remarkable mission for number of reasons. The clear mandate from the United Nations, the demonstrated ability of NATO to act faster than ever before, the regional support which proved critical and, last but not least, the fact that European Allies and Canada provided most of the combat assets.

But the success of that operation also depended on unique and essential capabilities in key areas which only the United States could offer.

Capabilities such as surveillance drones, air-to-air refueling and intelligence assets.

Working together, as an Alliance, could become increasingly difficult as the capability gap grows across the Atlantic. We must work hard to close these gaps. Because if we don’t, our ability to operate together will be affected. And that could well have serious consequences for our political cohesion.

Smart Defence

We need to change our approach.

We need to spend better.

To get better value for money.

To help nations to preserve capabilities and to deliver new ones.

This means we must prioritise.

We must specialise.  And we must seek multinational solutions.

Here I would like to specifically refer to the air policing of the Baltic States, which is an excellent example of role sharing and multinational cooperation.

Smart Defence will help the Alliance to have the right capabilities.

Nations will be able to provide capabilities together that they can’t afford to provide alone.

They will benefit from greater efficiency by working together.

From economies of scale.

And by building these capabilities together, operating them together will also become easier.

And NATO will benefit too.

The key is not for NATO to own capabilities.

The key for NATO is to have national or multinational capabilities available when the need arises.

Today NATO can rely on AWACS airplanes to conduct air surveillance and control missions over Afghanistan. This is because 17 Allied nations agreed - years ago - to operate and maintain these airplanes together.

I hope that in the future we will also have an Alliance Ground Surveillance capability.

And I welcome Estonia’s active support as one of the 13 participants in this key acquisition programme.

These are just two examples.

Many nations are considering the replacement of aging armoured vehicles, or the acquisition of capabilities for the protection against roadside bombs.

More multinational cooperation in these areas is something that all Allies, including Estonia, should consider very seriously.

But Smart Defence is not only about acquiring new equipment.

It is also about combining our efforts in other areas such as training and education, logistics, maintenance, as well as science and technology. There is already much experience in Estonia of such collaboration, for example you host the successful Baltic Defence College.

At NATO we have established - in cooperation with Allied Command Transformation - a detailed overview of possible projects that would benefit greatly from multinational cooperation.

These proposals include potential collaboration in the field of logistics, training, sharing of existing equipment, and so on.

Estonia has shown interest in a number of these projects.

NATO is ready to help identify projects of interest, that is why we are here today.

But, of course, the ultimate decision remains with the nations.

Smart Defence does not impose a one-size-fits-all solution.

It is not a straight jacket.

On the contrary, it allows for tremendous flexibility.

It can cover any, or every, phase of capability development.

From Research and Development, to production, procurement, maintenance and training.

It can cover small projects, or big ones.

Complicated projects, simple ones.

But let me be clear: Smart Defence should mean any savings achieved through cooperation being re-invested in new high-priority capabilities.

Smart Defence should not be an excuse for decreasing defence budgets.

NATO – EU and partners

Working together also means that we look for cooperation outside NATO.

We are seeking a coordinated approach with the “Pooling and Sharing” initiative undertaken by European Union.

The key is to deliver capabilities that build on the strengths of each organization and avoid any overlap. Careful coordination with the EU staffs, and with the European Defence Agency in particular, within the agreed framework, is key to facilitate coherence and complementarity and avoid any undue competition.

We need to be pragmatic, even more than we have been in the past.

The Strategic Airlift Capability in which Estonia participates, includes both NATO Allies and EU Member States.

This is a good example of a pragmatic approach going beyond organisational boundaries.

What is important, at the end of the day, is that this capability can be made available to both organisations. A strategic capability that individual nations could not possibly acquire, but which – operating jointly – they can procure and operate.

We must continue to harmonise our efforts with the European Union.

And encourage cross-participation of non-EU Allies and non-NATO EU Member States in multinational projects.

And we must encourage NATO Allies to engage willing and able partner nations for participation in multinational projects.

And we should encourage regional initiatives, such as the Nordic Defence Cooperation, where Estonia along with Latvia and Lithuania cooperate with the Nordic countries in an extensive cooperation within the defence area.

Ladies and gentlemen,

Let me conclude with some words on the way ahead on Smart Defence as we look at the Chicago Summit.

Because, now is the time to draw the right conclusions from the economic crisis.

We must prioritise our requirements and focus our attention, and money, on these key requirements.

That is the “what”, of our Smart Defence agenda.

We need to seek economies of scale wherever possible, so that we can re-invest savings on key priorities.

We must work together in flexible multinational formats to deliver these key capabilities and achieve genuine economies of scale.

That is the “how” of Smart Defence.

The Chicago Summit in May 2012 should be seen as a key milestone towards this new approach rather than the final destination.

Smart Defence is, by design, more than just another capability initiative. It is a key political initiative with a strong practical dimension.

At the Summit we will invite Allied leaders to sign up for a long-term commitment on Smart Defence.

In Chicago, we aim to present an ambitious and credible package of multinational projects.

And we will seek a strong commitment to a profound change in our mindset to fundamentally redesign the way nations design, develop, operate, maintain and eventually discard capabilities.

A strong political commitment to transatlantic solidarity and cooperation, with the strategic objective of providing security at an affordable cost.

am convinced that Smart Defence turns the economic crisis into an opportunity.

An opportunity that we must all seize together.

Thank you for your attention.