What Europe can learn from Israel’s defence industry

[LONDON] Europe is finally responding to the twin threats posed by its weak defence and lagging growth. Now, the continent must link its security and economic objectives and approach them in a manner that prioritises speed over perfection.

As Europe begins its re-armament, it should follow the example set by Israel, where the military has fuelled high-tech innovation and human-capital development. And if the threat of conflict with Russia intensifies, the European Central Bank (ECB) may need to provide additional finance – with some important guardrails in place.

Precipitating this monumental policy shift was Donald Trump’s return to the White House. The new administration’s apparent willingness to withdraw the United States’ security umbrella from Europe has heightened the threat posed by Vladimir Putin’s neo-imperial Russia, with its numerous frozen conflicts in former Soviet republics and its ongoing war of aggression in Ukraine. Moreover, the “America First” agenda has provided an impetus for the European Union to address its competitiveness problem, which former ECB president Mario Draghi identified in his 2024 report on the topic. When presenting his findings, Draghi warned that if the bloc did not close its growing productivity and innovation gaps with the US and China, it would face “slow agony”.