The Defense Industry at the Beginning of the Twenty-first Century : A European Perspective

Abstract

The processes of internationalization and globalization are present across all fields of human activity, including arms production. Political and economic changes following the end of the Cold War have led to the increasingly globalized production of armaments and trade in weapons. Yet not all defense firms across all regions are poised to compete well in this environment. The trend towards globalization has been exploited by American arms manufacturers to the greatest possible extent, given that U.S. firms are among the most powerful and best prepared for operation on the global market. American arms manufacturers also make good use of critical support from the U.S. government, which perfectly understands the rules according to which the industry operates. Recently, one can observe a rapid shift towards collective European defense research efforts and an integrated defense market. However, the capabilities of the European defense industry lag far behind those of the United States. It is worth remembering that the distance between Europe and the rest of the world is narrow. Finding a solution to the problem of globalization in the defense industry is of strategic importance for European companies. Without reform, Europe's defense industry will lose its ability to compete – a warning that holds particularly true for East European countries. The situation faced by the Polish defense industry at the beginning of twentyfirst century typifies the experience of other Central European countries. Until the end of the Cold War, the Polish defense industry ranked among the most powerful within the Eastern Block. However, after 1989, the situation changed. Owing to a number of factors (the collapse of the Warsaw Pact market, the advent of the new market economy, the shrinking global market on weapons, the lack of a cogent development strategy), the early 1990s proved extremely difficult for that industry in Poland. This paper thus traces the development of the Polish defense industry in the post-Cold War period, with special emphasis on restructurization process and export possibilities.