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In 2013 EU Leaders agreed that greater effort was required in the field of European defence and an implementation plan for CSDP was subsequently agreed in November 2016. The Plan was described as raising “the level of ambition of the European Union’s security and defence policy”, and among its aims was the utilisation of the Permanent Structured Cooperation (PESCO) mechanism that was first set out in the 2009 Lisbon Treaty.

Under the PESCO concept a smaller group of eligible, willing, Member States would be able to adopt decisions regarding greater military cooperation, therefore moving forward in certain areas without the full approval of all EU Member States. Among the long-term aspirations for PESCO were capability harmonisation, the pooling of assets, cooperation in training and logistics, regular assessments of national defence expenditure and the development of flexibility, interoperability and deployability among forces.

At the European Council summit in June 2017 leaders agreed “on the need to launch an inclusive and ambitious Permanent Structured Cooperation” and a notification of interest to establish PESCO was subsequently presented in October 2017. Twenty three EU Member States initially signed the Joint Notification, which set out the principles of PESCO, proposals on PESCO governance and the overall ambition for the project. Annex II of the Joint Notification also set out 20 specific defence policy commitments that participating states will have to meet, including defence spending targets, the harmonisation of requirements and greater collaboration in capability development.

Ireland and Portugal subsequently notified the Council of their decision to join PESCO bringing the number of participating states to 25. A decision establishing PESCO was formally adopted by the Council of Ministers in December 2017. Denmark, Malta and UK remain outside of PESCO.

Only participating Member States will have decision making rights with regard to PESCO. Those State which remain outside of the mechanism will have no powers or voting rights over projects or the future strategic direction of the initiative.

PESCO Projects

Any capabilities and assets developed under PESCO will remain under the ownership and control of the participating EU Member States and will be made available to NATO and UN operations. It will not give the EU control over individual nations’ armed forces, including the UK.

A formal Decision approving an initial list of 17 PESCO projects, including participating countries, was reached in March 2018. Among that initial tranche was armoured infantry fighting vehicles, military mobility and a European Medical Command.

A second set of PESCO projects was formally adopted by the Council of Ministers in November 2018. Among the more ‘strategic’ projects on the list is a medium altitude, long endurance unmanned drone, an upgrade to the Tiger attack helicopter and a high-altitude intelligence, surveillance and reconnaissance (ISR) capability.

A number of these projects could potentially be part-funded through the newly established European Defence Fund and at a higher rate of EU financing (30%) than that available to other collaborative projects set up with EDF funding (20%). However, EDF funding for PESCO projects will not be automatic.

The conditions under which third party states may be invited to participate in individual PESCO projects currently remain under consideration. A Decision had been expected, in principle, by the end of 2018. However, while the European Council in December 2018 welcomed the progress made in implementing PESCO, the Council’s conclusions revealed nothing about the terms of third-party participation, which led many to speculate that differences in opinion remain between the PESCO participating states.

Indeed, a meeting of the Foreign Affairs Council in June 2019 only called for the adoption of arrangements on third party participation “as soon as possible”.

A third tranche of PESCO projects is expected to be approved in 2019, followed by a fourth tranche in 2021.

Views on PESCO

While the creation of PESCO has been widely welcomed, several commentators have reiterated the need for complementarity between NATO and EU efforts, while others have questioned whether the extent of participation in PESCO may eventually lead to it becoming unwieldly and ineffective.

Many commentators have also expressed scepticism over the ability of PESCO to deliver the EU’s objective of strategic autonomy, unless the very largest capability projects, such as satellites or combat aircraft, are included in the initiative. Maintaining the momentum to move PESCO projects forward beyond their initial phases, are also regarded as somewhat of a challenge.

Position of the UK

The UK remains outside of PESCO and as such will have no decision-making rights or any veto over its future strategic direction.

Post-Brexit the Government has stated that it wishes to retain some sort of defence and security relationship with the EU, and specifically in capabilities development. It has long made clear its preference to keep the option of third party participation in PESCO, on a project-by-project basis, on the table.

However, if it wishes to participate, even on a project-by-project basis, the UK will have to find the terms of third party participation acceptable, which may include a broader commitment to sharing EU values and strengthening the EU’s Common Security and Defence Policy (CSDP). Brexiteers have expressed concern that the Government’s approach fails to deliver on the promise of Brexit and that the UK would be permanently tied to EU defence structures and principles, over which it would have no say.

This paper is an update to previous versions published in December 2018 and May 2019.   

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