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Former NATO Head of Defence and Security Economics Professor Adrian Kendry Interview

Professor Adrian Kendry - Interview for VOX Journal

On Wednesday 17th October 2018, VOX Journal interviewed Adrian Kendry, previously the Head of Defence and Security economics at NATO Headquarters in Brussels.


One of your responsibilities was to advise on the economic dimension of emerging security challenges. Bearing in mind that only a few of 29 member states are reaching the funding target of 2%, how confident are you that NATO’s principle of collective security can be upheld in the face of new and varied threats? - North Korea for example.

The mythical 2% is an iconic figure reflecting years of informal discussions about what would be an appropriate amount for the European members of NATO to spend. Now, the US spends around 3.6%, of its GDP on defence in contrast to Germany, which spends 1.3%. This disparity gives Trump an excuse to criticise Merkel on the grounds of insufficient spending, but that is true of NATO Europe almost as a whole.

What matters if the effectiveness of how countries spend their defence and security budgets. What the USA spends on its defence budget is in excess of 700 billion dollars but much of that is spent for US purposes in pursuit of their national security interests all across the globe taking account of perceived foreign threats. The identity of different actors and the intention of states play a key role in the NATO policy- making process. Although the USA has increased its spending on European defence reassurance initiatives, Europeans view security as a complex amalgam of economic and trade security, international aid and development in addition to pure military power. During my tenure as NATO I led the Building Integrity programme that was designed to increase budgetary integrity, transparency and accountability in defence and the related security sector in NATO members and. This focus on better governance and less corruption in all aspects of defence spending, procurement and administration. This work has made an important contribution to more efficient defence but the NATO allies can do a great deal more to ensure that what they are spending can be more effective. and reduce the waste that undermines the defence sector. In the face of emerging security challenges that have included North Korea and a resurgent Russia, there are multiple ongoing concerns from cyber insecurity, global terrorism, energy security and the huge instabilities posed by global warming and climate change. These issues provoke extensive political debate and bureaucratic challenges concerning NATO's role and raison d'etre in these spheres..


In light of your role of monitoring and reporting on developments in international economic security and stability, are you concerned about the rise in cyber warfare?

Yes I am absolutely concerned about the rise of cyber warfare. When I was in the political affairs division prior to moving to the emerging security challenges division, I was first made aware of the these new threats in regard to the energy security programme, where there was much consideration of the idea that if Russia felt that the revenues from their oil and gas were going to become restricted (bearing in mind the revenues from the energy sector are essential for the Russian budget) this could escalate Russian cyber attacks in order to generate crisis and drive up the price of oil and gas. So cyber security became a critical focus. It’s a classic case of contemplating what non-kinetic weapons might be available at any one time. For example, the spread of cyber attacks beginning in Estonia and spreading throughout the Baltic States, increasing prior to the occupation of the Crimea and insurgency in Eastern Ukraine.


In view of the increasingly popularised view that the US’s role as a global hegemon is diminishing, alongside the multipolar nature of the world, are you optimistic about NATO’s funding and role as a ‘primus inter pares’ being maintained, especially in regard to Trump’s protectionist policies?

Many businesses are worried about protectionism and what it will do to supply chains and business relationships globally-especially taking into account Brexit. The Trump administration remains strong amongst those who voted for Trump in the first place, just as is seen in Brexit. The midterms are likely not to be the disaster for Republicans that have been forecast. It is very difficult for Republican congressmen to distance themselves from the Trump phenomena. Wealthy evangelical Christians believe he has been sent from God to show them what a sinner is-so they should support him, and Jewish supporters who support his policies of moving the US embassy to Jerusalem. For the poorer areas of the USA he represents a man willing to challenge the status quo. In the context of NATO, it’s absolutely clear that there has never been such a high level of disagreement. The US ambassador often lacks clear and precise directions from the White House, while on some occasions the Ambassador makes dangerous and destabilising statements about the removal of new Russian missiles in the Kaliningrad region.


So if funding has diminished or is being threatened on a state level- what is the role of private companies that contribute to NATO funding?

This issue is under the authority of the Defence Investment Division at NATO which connects European and American financial contributors. contracts are mostly in favour of NATO as the private companies typically do not yield substantial returns on multinational defence investment. However, the same companies gain a lot of influence through their financial contributions. The defence sector in the European Union is notoriously fragmented, with until recently a lack of effective coordination and guidelines to transform the sector. There has been a clear failure coming from the EU to sustain a certain level of defence but the new initiatives under the auspices of Permanent Structured Defence Cooperation (PESCO) offer the prospect of significant improvement in both funding and efficiency of European defence.


So national financial contributions are made support NATO civil and military administrative budgets?

Indeed. The grey zone is where the two forms of national financial contributions based on cost sharing arrangements determined by GDP metrics provide operational support, staffing and logistics for the NATO headquarters civilian and military budgets. The United States is the largest contributor but its share is proportionate to being the largest economy.


The original strategy of NATO was, as Lord Ismay said ‘keep the Russians out, the Americans in, and the Germans down’ naturally this objective has changed over the last few decades, but in light of this do you think NATO has lost relevance? How has NATO remained relevant in the 21st century?

With the shared interest after 9/11 of transatlantic security and defence, it was hoped that NATO and Russia could reach some sort of agreement or cooperation. But Russia has never really escaped the notion that NATO expansion sought to undermine the Russian power base, it’s a historical reflex about Russia’s vulnerability.

So keeping Russia out has a new kind of dimension to it after 2014. Keeping the Americans in is very much a question of each administration and particularly with this the Trump administration. Keeping Germany down, well you might argue that Germany has kept itself down in some sense, coming to terms with its own past and the complexities of immigration and the rise of political populism and so forth. NATO struggles around the table of the council to marry all these concerns because some states hold views that are not conductive to supporting the solidarity of the alliance, often reflecting national, domestic, political interests, albeit looking also for the strategic question of relationship between energy and economic security as well as political security.

The self-seeking nature of states is much more apparent than it used to be. When I used to sit in these meetings you would see the geopolitical tensions between certain countries like Greece and Turkey for example. Other tensions surrounding alliances between the UK, USA and Saudi Arabia produce difficulties as has become increasingly evident. Other countries see these alliances as unacceptable and contributing to the funding and exporting of radical Islam.

But actually, I don’t think NATO is going to give up and collapse, partly because when everything around you seems to be disintegrating you look to the constants. All of our international institutions are fragile in some ways, the UN, World Bank, IMF, but in reality some of these institutions are very resilient. That’s not to say they are incredibly effective, sometimes quite the reverse, but they do at least seem to provide pillars of constancy in an incredibly fragile, disruptive and anxious world.

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