The negotiations lasted a whole year, they were accompanied by personal threats, even an anonymous blackmail should have given it. This week, the whole of France and almost all of Germany stayed even in the holidays, then the breakthrough: On Wednesday the Munich tank builder Krauss-Maffei Wegmann announced (KMW) and his French competitor Nexter Systems that they will merge. The new weapons of war giant bears the project name “Kant” and 6000 employees employed.
The merger of the two defense specialists is much more than just the coming together of two companies. He is regarded as a dress rehearsal for the fundamental question of whether mergers in Europe’s defense industry are still possible. After years of deadlock is the deal: It obviously goes yet. According to the deal was hailed as “Airbus of tanks”.
KMW CEO Frank Haun said after the signing in Paris of an “alliance, the overdue a contribution to the consolidation of the European defense sector “was. Nexter CEO Philippe Burtin thanked all participants by more than a year of negotiations “for this strategic project in Europe”. And the French Defence Minister Jean-Yves Le Drian raved about a very important step, should emerge from the “a leading European arms suppliers”.
But the enthusiasm of company bosses and their governments is not shared anywhere. Admonishing voices from business, science and politics are, according to the contract was signed, particularly in Germany. Critics fear the loss of jobs and engineering know-how, but also the surrender of sovereignty in a core area of government action: the ability to defend one’s own country and the secured equipment of national armed forces would so weaken
The arms industry is not an industry like any other
In a free market economy, companies can naturally join together at a whim. But the defense industry is a trade like any other. Your clients are countries that not only slimming products, but also research and development subsidize. And on the world market may not be weapons of war so easily sold but subject to arms export restrictions. Production and trade are therefore under state control. This applies to the tank builder in particular.
Just recently, the federal government’s production of” armored platforms “declared a defense key industry that in “national security interest” is strongly encouraged. That, as stated in a policy document, although is possible also in collaboration with European partners. The only question is whether the federal government and the French government understand the same thing under European cooperation.
Markus C. Kerber is located not so sure. “All experiences in the cooperation with French companies are negative,” says the economics professor, who teaches at the Technical University of Berlin and at Sciences Po in Paris.
“The French say Europe and my France,” says Kerber. “European cooperation is a rhetorical ruse to push through national interests ruthlessly for them.” Berlin, according to the professor, it makes Paris easily: “Germany has industrially far more to offer than France and nevertheless behaves like a gross national product as a liability mass, without any desire for political power.” Kerber fears that the Germans might be cheated at Kant so as with other joint ventures with France.
On paper was in mergers, although always of equal partners speech. But after a short time always gave France the tone. Example Airbus: The agreed 15 years ago parity tipped in favor of the French, because of the sales of military equipment shrank. The victims were the German locations.
At Aventis, the Germans were subject to the power of Poker
Just as with Hoechst. 1999 merged the pharmaceutical company with the French competitor Rhône-Poulenc to Aventis. At the beginning of the Franco-German joint project was finely balanced. The seat was in Strasbourg, France, the top job got Hoechst CEO Jürgen Dormann. But after more than two years, the German retired, worn down by the power of the French poker. In 2004, when even the French pharmaceutical company Sanofi-Synthelabo Aventis swallowed, the company was finally French. The remains of Hoechst on previous headquarters in Frankfurt are now controlled from Paris.
And in Kant? The Leopard II main battle tanks manufactured by KMW “is the best-selling battle tanks in the world, a flagship product of German engineering,” says Professor Kerber. “What we can expect from a manufacturer in France by cooperation, has retracted his battle tanks only loss me is not clear.” The economist believes that Germany can perform again.
From a corporate perspective, however, the merger could make perfect sense. With the joint venture formed in addition to the aviation giant Airbus now also a large army technology group in Europe, as a counterbalance to global players such as the US company General Dynamics. The merger secure jobs, insured the company’s previous bosses Haun and Burtin in Paris.
The national markets shrink, military budgets are cut back. Therefore, cooperation is needed, as this increases the sales market. At the same time, there are synergies in purchasing and sales, an addition to the product range. So not provide Nexter Munitions ago, KMW against. KMW again not tactical builds bridges Nexter. Nexter CEO Burtin expected synergies of 60 million euros in five years. For the same reasons you hold in the Federal Ministry of Economics of the merger simply for “consistently”.
SPD expert fears disadvantages for Germany
German professional politicians do not share this view. Rainer Arnold, the defense spokesman of the SPD, fears that the federal government can draw once more across the table from her French partner. Arnold has his opinion is not made easy. He has researched in France, can be translated papers of the Court and of Parliament, met in Paris French colleagues. The conclusion: “I see to be the risks and I expect that the federal government now doing everything possible to minimize these risks..”
Two Points are Arnold particularly important. First, the federal government should have an influence “on the concrete contracts of the two companies.” Secondly, we need a bilateral, bilateral agreement between Germany and France, “in which our interests are protected. It is unacceptable that at KMW constructed also with control means know-how easily flows into the neighboring country.”
So it keeps the SPD politician necessary that the 50-to-50 parity in the new company can not move unilaterally after five years in favor of France. In addition, should be laid down, “what happens if both companies offer competing products on the market. It may not be that German products are taken off the market.”
Arnold stands in Parliament since no means alone. The Union is skeptical. The CSU defense expert Florian Hahn demands that the federal government to use its influence, “so that no jobs will be lost in Bavaria and the tank construction remains as German key technology”. And the CDU foreign policy expert Roderich Kiesewetter warns that “the alleged advantages to be enjoyed by the merger of the leading tank manufacturer Kraus-Maffei Wegmann with Nexter with caution” would.
He fears that the supply of the Bundeswehr could be difficult with reliable technology, because caused by new mixed conglomerates regularly called black boxes. Should read: The customer buys a defense product, it uses, but can not look under the hood
Green:. Defense industry is facing series of mergers
The green defense expert Tobias Lindner holds a consolidation of the defense industry in Europe is inevitable. Despite the pending approval by the antitrust authorities and the missing approval by Economy Minister Gabriel, who must consider the deal on the basis of the Foreign Trade Act, Lindner sees little chance that “this movement can be held back by the political side” could. All the more urgent, however, it is that the policy creates a legal framework set, “so as not to become Wretched in this consolidation movement. Here the federal government has set over the years the hands idle in her lap.”
The Green is primarily aimed at common rules for authorization, security, arms exports, and procurement and tendering procedures. “A fusion of KMW and Nexter may only take place if it is ensured that at the end of German arms export regulations can not be softened or circumvented.”
This looks Rainer Arnold like that. “If our economy minister says the merger did not affect the strict German arms export regulations, then this may be true for now. Medium and long term but the French will try to impose their less stringent principles.”
They even have good cards that succeeds. The reason is well hidden in the archives of the Federal Ministry of Defence and is not accessible as a confidential matter for the public: The so-called Schmidt-Debré Agreement of 1972, named after the former defense ministers. “Neither of the two governments will prevent the other Government from war weapons or other military equipment, which emerged from a jointly implemented development or production, exportation to third countries or to have”, it says in the contract.
The Agreement old weapons systems such as the Transall C-160, the Alpha Jet, Ratac, Milan and Roland are explicitly mentioned. However: Future Community developments are also covered by the Agreement, unless special arrangements are made
Gabriel approved fewer exceptions than its predecessors
The agreement is for Sigmar Gabriel tricky. The Minister approved significantly fewer exports of military equipment than its predecessors. France has since fewer inhibitions: Paris provides military equipment in crisis regions such as the Gulf States or Russia. Could Kant deliver future thanks to the Schmidt-Debré Agreement battle tanks in war zones, the Gabriel
would bring in Erklärungsnot. Gabriel House appeased. “The strict German export regulations apply unabated,” it says. The agreement applies only to the state level. The French, however, claim the opposite: The Schmidt-Debré Agreement applies very well for new developments Kant because future projects of the company are awarded by the state
. That the Schmidt-Debré Agreement until today is in any case in force, acknowledges the federal government in an answer to a request of the Left Party politician Jan van Aken. The Agreement “shall apply to bilateral official government armaments cooperation between Germany and France,” it says in a letter from the authorities responsible for defense state secretary in the Economy Ministry, Matthias Machnig (SPD).
is all the more important, a new bilateral treaty between the two countries, says Rainer Arnold. The federal government strives for even that. She is pushing for a political armor treaty with France, so it is on the response of the Ministry of Economic Affairs to van Aken. “After signing the merger agreement the Federal Government intends to enter into with France a bilateral agreement on strategic arms policy issues.”
The goal is clear: The restrictive German standards for arms exports should not be relaxed during the negotiations. But then the French would have to adapt their rules to German. By this, of course, the French government may have no interest. For only the loose Export practice ensures that anybody decreases the French products
SPD expert:. Bundestag is to be included in contracts
could be sold to 17 countries during the “Leopard 2″ of KMW, were convinced by his French counterpart, the “Leclerc” of Nexter, only the armed forces of the United Arab Emirates. French Foreign Minister Laurent Fabius had already in 2014 excited about the restrictive German export rules. When products are being built together, they would have to can also be exported
The federal government wants in the treaty but mainly to hold the conditions under which the ownership structure can be changed as technology outflow is prevented in a key technology and what happens to the suppliers of Kant. Should the new consolidated commission only French firms, the German supplier of KMW would hit hard.
why SPD man Arnold requires involvement of the Bundestag in the contract design: “When it comes to future projects, we can and will already say. Acceptable are only contracts that guarantee clear safeguards and a fair division of labor in production and development” That applies as for the main battle tank of the future, the two companies intend to develop. “The Leopard III may not French,” says Arnold, “he must be a real joint effort.”
The government in Berlin is planning, the business quickly complete. The agreement with France will be finalized by the end of October, told the “Welt am Sonntag” from government. But economist Kerber wonders whether such an agreement benefit much: “Who knows the practice with France knows that blithely never holds the French policy on contracts.”
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