Investing in Defence: strategic investments in today’s global dynamics

The ever-shifting geopolitical landscape, particularly in Europe, calls for a thoughtful re-evaluation of our defence strategies. Unified aids in preparing the Dutch, European and NATO defence industries to help tackle emerging threats. As rapid changes and new challenges arise, there is an increasing need for a more resilient and sustainable defence sector to uphold our values and standards.

Current vulnerabilities in our defence capabilities point to the importance of strategic investments. By acknowledging and addressing these gaps, we can better protect our societal norms and values. Strengthening our defence industry will help manage immediate risks and prepare for potential future threats, contributing to regional peace and stability.

 

Strengthening the defence sector: a pillar built on innovation and resources 

A stronger Dutch and European defence industry relies on two critical pillars: increased production capacity and strategic investment in European innovation. The Netherlands, renowned for its innovative spirit, needs substantial long-term resources to enhance these capabilities. “We have significant potential in the Netherlands, but our expertise in defence is either limited or not yet at the production level required”, states Michel van Ierland, Managing Partner of Unified International. Unified can play an important role in addressing this gap by providing expertise to guide effective sustainable investment, thereby helping to strengthen and scale our defence capabilities.

Sustainable funding drives innovation in defence, empowering research and development (R&D) of cutting-edge weaponry and communication systems. This focus on innovation creates value across both the defence and general industry sectors, fostering technological advancements that benefit society as a whole. A long-term vision is therefore essential to encourage these investments and build robust defence capabilities, ensuring our technological edge on the global stage. Unified’s role is to provide valuable insights and guidance on these investments, helping to shape a long-term vision for strengthening our defence capabilities and maintaining our technological edge.

 

Financing defence: opportunities and challenges

Financing the defence sector presents both opportunities and challenges, particularly with the growing emphasis on Environmental, Social, and Governance (ESG) principles. The current geopolitical climate, especially with Russia’s recent movements, necessitates a response from the financial sector.

The realisation that peace and security in Europe cannot be taken for granted has fostered a more positive outlook on defence investments. Immediate action is required to strengthen promising Dutch companies or explore European alternatives to ensure both compliance with ESG principles and security.

 

Private equity’s role in fostering innovation

Private equity plays a pivotal role in driving innovation within the defence sector. However, attracting private equity investors can be challenging. This trend is more commonly observed in countries like the US, UK, Canada, and Switzerland. The Netherlands, along with countries like Germany, relies heavily on family businesses and family offices for investments in defence. These industrial families play a crucial role in the initial phase of scaling up defence capabilities through their investments, driving the development of new technologies and enhancing military capabilities.

One of the companies we collaborate with ‘Reiger,’ exemplifies the positive impact of investments in the defence sector. This family business successfully integrated high-level technologies from the automotive sector into the defence industry. Their cross-sectoral investment demonstrates how innovations from other industries can elevate defence technologies and capabilities. Creating a new high-end product for the user with export potential.

 

Reassess ethical considerations

Considering growing security threats like cyberwarfare and autonomous weapons, there is a need to reassess the ethical criteria governing defence investments. Shifting operations and technologies necessitate a re-evaluation of ethical frameworks for modern warfare. The Netherlands and other NATO countries already enforce strict ethical standards when acquiring and deploying defence equipment. Public choices during elections reflect these ethical considerations, underscoring the importance of transparency and accountability in defence investments.

 

Challenges for  investors in defence

Private equity investors face challenges specific to the European defence market. Understanding political developments and their implications on defence spending is crucial for making informed investment decisions. Investors must also grasp the intricate value-creation process within defence companies. The ‘Institutional Investor Platform’ has highlighted the necessity of increased investments and knowledge sharing among investors to raise awareness about the defence sector in Europe.

 

 

Investing in Dutch and European defence: a strategic imperative

Investing in Dutch and European defence is not just a necessity, it’s our strategic imperative for a secure and stable future. Europe has the capabilities and knowledge to act. We are behind schedule, but it’s not too late. By investing in our own capabilities and reducing dependence on others, we can ensure the security and sovereignty of the Netherlands and Europe. A robust European defence industry fosters international collaboration, promoting joint research and development projects and strengthening strategic partnerships. By co-developing and exporting defence technologies responsibly, Europe can contribute to global security and protecting values. Investment must be accompanied by strict oversight and ethical considerations to ensure responsible use of public funds. Continuous investment and a forward-looking approach are crucial to secure a stable and prosperous future for Europe.

 

Unified: optimising defence investment strategy

Unified plays an important role in preparing the industry, especially in the Netherlands and Europe, to face current and future challenges. We assist investors in enhancing their market know-how and making informed value-based investment decisions. Our assessments highlight the need for immediate action, taking into account the long-term and comprehensive nature of these investments. Recognising Europe’s strength and value on the international stage is vital, alongside reducing dependency on America by leveraging our extensive knowledge and expertise.

 

Ready to collaborate?

Are you a high-value manufacturer or investor with a heart for the Netherlands and Europe? We are ready to collaborate. Unified International bridges the gap and projects between the Dutch industry and the Ministry of Defence. We support military procurement with expertise and a “can-do” spirit.

Find out more on our website https://unifiedinternational.net/defence/ and do not hesitate to contact us.

 

About us

Unified International Defence is a recognised consultancy firm that supports companies and the government within the Dutch defence domain. In defence advisory projects, our focus is on strategic positioning, procurement, and materiel projects. We are also strong in project and program management. Unified International leverages strong relationships at all levels within the defence domain and relevant ministries on a daily basis. We are entrepreneurial, proactive, and have a can-do attitude.