French Defence Policy Since the End of the Cold War by Alice Pannier Olivier Schmitt

Author:Alice Pannier, Olivier Schmitt [Alice Pannier, Olivier Schmitt]
Language: eng
Format: epub
ISBN: 9781138084629
Barnesnoble:
Publisher: Taylor & Francis
Published: 2020-12-28T00:00:00+00:00

The evolution of the structure of the industry and main producers

More than in other advanced economies, the structure of the French defence industry continues to reflect the political commitment to maintaining an autonomous supply of equipment to the armed forces. Adjustments have been necessary over the past three decades to compensate for the financial difficulties mentioned above, namely via a dual process of privatisation and concentration, nationally and at the European level.

Most of the potential of the French industry was destroyed during the Second World War, contrary to what happened in the United Kingdom or the United States. The bases of the contemporary French defence industry therefore were developed in the 1950s through to the 1970s. The industry expanded over that period due to the combined effects of the Indochina War, De Gaulle’s great ambitions for national independence, and the exponential growth of exports. This period of growth has since been followed by a durable downward tendency that paralleled that experienced by government equipment spending, which we have discussed. In the 1980s, national economic growth slowed down, at the same time the international arms market became increasingly unstable towards the end of the decade, and the drop in both national orders and exports worsened in the 1990s. From the 1980s onwards, the industry has had to restructure and downsize: 100,000 jobs were lost in a decade (Dussauge and Cornu, 1998, p. 16).

Since the 1980s, both right-wing and left-wing governments have implemented a process of industrial privatisation and progressively withdrawn from the capital of the main defence companies in order to promote transnational rapprochements. Matra was privatised in 1988, Thomson-CSF in 1998, Aérospatiale in 1999, and Safran (ex-Sagem) and DCNS, partially, in the 2000s. In France, this process of privatisation has not been as complete as it has been across Europe. With the exception of Italy and Spain, France is one of the few European governments that has not gone as far as total privatisation of the sector, and it is in France that the level of public participation in the capital of the defence industries remains the highest (Masson, 2007, p. 1). Indeed, the capitalist links that connect the major defence groups reveal that the presence of the French state is either direct and total (e.g., Nexter and Naval Group – ex-DCNS), either it possesses large but minority shares (Safran, Thales), or is involved indirectly, through corporations created for this purpose in which the state itself is a shareholder (e.g., Dassault) (Serfati, 2014, p. 36; Fawaz et al., 2019). In 2014, the state acquired one share of the Dassault industrial group and signed an important convention “enabling the State to defend its essential interests in the event of changes in control of this strategic company, in particular, due to its contribution to the airborne component of nuclear deterrence” (Cabirol, 2014). Table 4.1 indicates in more detail the extent of the French government’s participation in the main defence groups.

Table 4.1 Main French defence companies

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