VARIO Advisory Report 38: Opportunities and needs for the Flemish defence industry and -innovation
On April 22, 2024, VARIO received a request for advice from former Flemish Minister of Innovation Jo Brouns regarding the opportunities and needs for a broad Flemish defence industry and innovation. In the meantime, the new legislature has commenced. For the first time, the Flemish Coalition Agreement 2024-2029 includes defence as a strategic sector.
VARIO believes that the commitment in the Flemish Coalition Agreement must now quickly lead to a clear, consistent, and stimulating policy framework for the defence industry and innovation. Several barriers need to be removed and certain elements facilitated.
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Request for advice
On April 22, 2024, VARIO received a request for advice from former Flemish Minister of Innovation Jo Brouns regarding the opportunities and needs for a broad Flemish defence industry and innovation. He argues, “The geopolitical reality has changed drastically in recent years. At the same time, we have seen an increase in the number of initiatives at the federal, European, and international levels regarding the security and defence industry and innovation. These developments are also important for Flanders, given the interfaces and overlaps of all this with Flemish (economic) interests and strengths.” Therefore, the minister seeks advice on the following elements:
- An analysis of the (changing) policy frameworks in the Walloon Region, NATO, the European Union and its member states, and the surrounding countries.
- The opportunities for and needs of the Flemish industry and knowledge institutions in the security and defence arena.
- What are our strengths?
- Where can we be strong?
- What is needed policy-wise to achieve and/or strengthen this?
- How can Flemish stakeholders participate maximally in supranational initiatives and what role can the Flemish government play in this (methods and instruments)?
- A mapping of the Flemish stakeholders with potential in Flemish security and defence initiatives and of strategic sectors and/or domains.
The minister expected the advisory report by the end of October. The intention was that in the next legislature, based on this report, the necessary policy measures would be taken and policy frameworks would be developed to respond to the various initiatives, to develop a strategic vision that increases Flanders’ resilience, and to further strengthen and profile Flanders’ high-tech economy on the international stage.
September 30, 2024 - New Flemish Government: Flemish Government Agreement 2024-2029
“Meanwhile, the new legislature has commenced. In the Flemish Government Agreement 2024-2029, defence is included as a strategic sector for the first time: ”It is also necessary to increase our strategic independence in important technologies, sectors, and crucial raw materials, such as the chip industry, our ports, and the defence industry.” Furthermore, the Flemish Government Agreement zooms in into participation in supranational initiatives, inter-federal cooperation, and the Muyters Circular.
Linked to this, and important for defence, is a passage in the Government Agreement regarding effective control of strategic goods: “The reference framework for export control is European.” Additionally, international opportunities and access to (growth) capital are mentioned.
VARIO advisory- and analysis report part I
In view of the policy note ‘Economy, Science, Innovation, and Industry’ 2024-2029, VARIO decided to timely provide its advisory report to the new Minister of Economy, Innovation, and Industry, Matthias Diependaele. The analysis report on which VARIO bases its recommendations will therefore be delivered in two parts.
- Analysis Report Part I focuses on the opportunities and needs for the Flemish defence industry and innovation and is bundled together with the present advisory report.
- Analysis Report Part II includes the policy frameworks and the mapping of the ecosystem and will be published by the end of 2024.
Recommendations
Based on the results of the SWOT analysis and the analysis of the Muyters directive, along with the findings from the analysis of policy documents and the ecosystem (VARIO advice Part II, end of 2024), VARIO formulates a number of recommendations.
Recommendation 1: Walk the talk - the signal from the flemish Government Agreement must be followed by a clear, consistent and stimulating policy Framework for defence industry and innovation
Recommendation 2: strengthen communication with and involvement at the Ministry of Defence and the wider federal level
Recommendation 3: facilitate networks, partnerships and access to (international) consortia
Recommendation 4: facilitate R&D&I in the security and defence sector
- Recommendation 4.1: after loosening in 2018, it is now time for another step: release restrictions from ‘Circular Muyters’
- Recommendation 4.2: open the Flemish support measures for R&D&I and remove barriers
- Recommendation 4.3: guide and facilitate interested knowledge institutions in their access to security and defence R&D&I
Recommendation 5: ensure an export level-playing field at European level
- Recommendation 5.1: use for Flemish exports the European framework
- Recommendation 5.2: ensure efficiency gain in export control – export authorization lead time
Recommendation 6: facilitate access to and cooperation with the Ministry of Defence
- Recommendation 6.1: support companies and knowledge institutions in gaining access to the Ministry of Defence and make our Flemish assets known
- Recommendation 6.2: facilitate knowledge institutions and companies in obtaining security clearance
Recommendation 7: conduct a thorough analysis of financing/investment needs and take action to remove the obstacles