If members of NATO achieve their pledges to achieve defense spending levels that reflect the size of their respective economies, that could mean as much as $100 billion annually in additional defense spending, Lockheed Martin’s [LMT] top executive said on March 21.

“In fact, if NATO members fulfill their already stated pledges to spend 2 percent of their GDP on defense, if could result in a $100 billion increase in spending across the alliance,” Marillyn Hewson, chairman, president and CEO, of Lockheed Martin, said at the company’s annual media day.

GDP is the acronym for Gross Domestic Product and basically is the measure of the size of a nation’s economy.

International defense sales are a growing part of Lockheed Martin’s overall revenue. Hewson said that in 2016, the company’s international business was more than $12.7 billion, nearly 27 percent of overall sales. She added that in a few years the goal is to achieve international sales to 30 percent of the business.

Lockheed Martin reported $47.2 billion in sales in 2016 and projects between $49.4 billion and $50.6 billion in 2017.

The largest driver of the company’s future growth in international business is the F-35 fighter, Hewson said, adding that about 50 percent of orders for the aircraft in the next five years are expected to be from international customers.

Hewson also said the Sikorsky business unit, which Lockheed Martin acquired from United Technologies Corp. [UTX] in November 2015, will also contributed to international sales through defense and commercial helicopter programs. Missile defense programs are another major driver of international business.

Beyond a growing international business, Hewson also said that President Trump’s commitment to increasing domestic defense spending bodes well.

“Although the path ahead on the federal budget remains complicated, we are optimistic that this renewed emphasis on national security issues will be sustained,” she said.

Hewson also lauded the president’s and Congress’ support for budget stability, corporate tax reform, and the reduction of inefficient regulations and ineffective government processes,” saying that moving out on one or all of these will help the larger defense industrial base and result in “a stronger economy and more robust job creation.”

Hewson is a member of the Manufacturing Jobs Initiative launched by Trump to find ways to get U.S. companies to manufacture products domestically rather than build plants in other countries. Hewson said that she is on a working group charged with reducing regulations as well as on a workforce of the future group.

“It’s all about creating jobs,” Hewson said.

Hewson said that former President Barack Obama’s executive order in 2014 on Fair Pay and Safe Workplaces only served to add “onerous reporting requirements” on top of existing laws and regulations, adding that these additional requirements were harder on small and medium size businesses that don’t have the resources to easily comply.

Trump in 2017 nixed Obama’s order, which required federal contractors to disclose violations of labor laws.

Hewson said Trump’s directive to agencies to look at reducing regulations across the federal government is good for small businesses, which she called the “innovation engines,” because they often don’t add value and will decrease reporting requirements.

After the election and before his inauguration, Trump criticized the F-35 program for its high costs. The president has taken credit for $700 million in program cost savings, although no evidence has been cited by anyone that his involvement in the program has decreased costs.

Earlier in 2017 the Pentagon and Lockheed Martin inked a nearly $9 billion contract for the Lot 10 buy of F-35s, a deal that brought the Air Force’s variant of the aircraft to under $95 million per copy, the first time the unit price dipped below $100 million. However, the program’s production costs have been on a downward path for years as volumes ramp up and the learning curve comes down.

Hewson credited Trump for helping get the Lot 10 contract negotiated sooner than expected but stopped short of crediting the president with any program savings. The company and the F-35 program office have said the unit cost of the fighters will continue to decrease as production increases.

The F-35 production contract for Lot 11 is expected to be finalized later in 2017.

Defense Secretary James Mattis on March 22 endorsed the Pentagon’s European Reassurance Initiative.

“If we don’t have the funding to maintain (ERI), then, frankly, the reassurance goes away,” Mattis told the Senate Appropriations Defense Subcommittee March 22. “As if we’re denying a reality that has been pretty revealed to us over the last several years.” Aerial view of the Pentagon, Arlington, VA

In response to Russian “adventurism,” as Mattis described it, the Defense Department requested $3.4 billion for ERI in fiscal year 2017, a nearly four-fold increase from FY ’16. Unfortunately, DoD has been operating under a continuing resolution (CR) since Oct. 1, meaning it is operating under FY ’16 spending levels until a new defense appropriations bill is signed into law. DoD requested $789 million for ERI in FY ’16, with $471 million enacted.

The ERI proposal for FY ’17 would increase military presence in Europe, add bilateral and multilateral exercises and training with allies and partners, enhance prepositioning of United States equipment in Europe, improve infrastructure to allow for greater responsiveness and intensify efforts to build partner capacity with newer NATO members and allied partners.

ERI would specifically provide an Armored Brigade Combat Team; various Black Sea, Mediterranean Sea and Baltic Sea multinational exercises; a Marine Corps Black Sea rotational force increased presence; persistent mobility Air Force capability and U.S. Air Forces in Europe flying training exercises, among others.

Though Mattis endorsed ERI, the twist is that it could be adjusted once DoD submits its first budget proposal under President Donald Trump, who seeks to pursue warmer relations with Russia.

The State Department approved a possible $150 million Foreign Military Sales (FMS) request to the United Kingdom for Hellfire missiles and related support services.

The Defense Security Cooperation Agency (DSCA) notified Congress of the potential sale on March 16.

The request includes 1,000 AGM-114-R1/R2 Hellfire II Semi-Active Laser (SAL) missiles with logistics support services and other related program support.

DSCA said there is no primary contractor associated with the sale because the missiles would come from U.S. military stock.

The U.K. would use these missiles to improve its capability to meet current and future threats by providing close air support to counter attacks on coalition ground forces in the U.S. Central Command area of responsibility and other areas as needed, the agency said.

DSCA highlighted this commonality between close air support capabilities increases interoperability between the U.S. and U.K.’s military and peacekeeping forces and allows for greater burden sharing. It also noted the U.K. already has Hellfire missiles in its inventory so it will be able to absorb the additional missiles without difficulty.

Implementation of the sale would not require the assignment of additional U.S. government or contractor representatives to the U.K.

The NATO Communication and Information (NCI) Agency signed an agreement with U.S. Army Europe to increase NATO’s support for U.S. deployments in Eastern Europe, the agency said March 16.

Under the Joint Partnership Statement, the NCI Agency will provide new solution to U.S. Army Europe to help enhance how it interacts with other allied nations. This aims to help the U.S. elements of NATO’s enhanced Forward Presence in the East.

The enhanced presence refers to how at the 2016 NATO Warsaw Summit, the alliance decided to strengthen its deterrence and defense posture by establishing an enhanced Forward Presence (eFP) in Estonia, Latvia, Lithuania, and Poland. This presence will contain four multinational battalion-size battle groups. The U.S. is leading one of the battle groups set to deploy to Poland in April. Batallions based in Estonia, Latvia, and Lithuania are led by the United Kingdom, Canada, and Germany respectively

Lt. Gen. Ben Hodges, commander of U.S. Army Europe, cheered the NCI Agency partnership.

“US Army Europe considers NCI Agency a strategic partner in establishing and maintaining robust, reliable Command and Control networks. The enhanced Forward Presence (eFP) provides a real opportunity to validate Mission Command in support of the NATO Command Structure and formations from four different Nations,” he said in a statement.

Hodges characterized the eFP mission as a forcing function to implement the full power of the Federated Mission Network concept “and prove NATO’s ability to quickly and seamlessly integrate multiple national forces providing a creditable example of assurance and deterrent within Europe.”

Hodges said the agency will support the U.S. Army by developing and implementing a “robust” operational network at Mission Secret level for the eFP mission. It will be done in collaboration with Allied Joint Force Command (JFC) Brunssum in the Netherlands and Multinational Corps Northeast in Szczecin, Poland.

“The eFP Mission Secret Command and Control network could be the first real world application of the Federated Mission Network concept and may prove value added to NATO alliance for years to come,” he added.

This network support will include the NCI Agency-provided Mission Information Room (MIR), a tool that uses the cloud to deliver the mission secret network and applications. The agency developed the tool and it is managed by JFC-Brunssum and JFC-Naples.

Hodges highlighted the MIR as a powerful concept and tool for multinational interoperability. “The MIR, if used properly, could be a ‘digital power projecting platform’ allowing for planning and collaboration in the earliest stages of an operation then quickly translate into Command and Control functions for the follow on phases of the operation,” the commander said.

The NCI Agency said U.S. Army Europe is its third customer to sign a Joint Partnership Statement after Allied Land Command (LANDCOM) in Izmir, Turkey and Allied Maritime Command in Northwood, UK.

The agency’s work with these partners is part of the NATO First Solution, which aims to re-use the capabilities that NATO develops under common funding as much as possible. This seeks to promote synergies between common and nationally-funded programs and services, the NCI Agency said.

Lithuania’s Ministry of National Defence selected Orbital ATK’s [OA] MK44 Bushmaster Chain Gun to arm the Lithuanian Army’s new Vilkas 8×8 infantry fighting vehicles, the company said March 16.

Under the agreement, Orbital ATK will deliver the MK44 beginning in mid-2017.

After the contract is completed, the company will have supported the integration of 90 cannons into Israeli-based Rafael’s Samson MKII Remote Weapons Station. The station has a low-silhouette and ability to reload under armor inside the hull. Orbital ATK said the cannon’s increased firepower in addition to the weapons stations features will provide greater crew survivability and effectiveness compares to the country’s current infantry fighting vehicle fleet.

The MK44 will be delivered ready to use the Orbital ATK 30mm MK310 Programmable Air Bursting Munitions (PABM) which is used to defeat enemy targets in protected (defilade) positions. The PABM cartridges offer three settings: air-burst, point-detonate, and point-detonate with delay fuze, which can penetrate light armor vehicles and reinforced concrete walls, the company said.

The delay fuze setting allows a round to penetrate a wall or fortified structure before bursting on the other side.

Orbital ATK said the MK44 can also be upgunned to a 40mm configuration, which “provides future growth for the gun system to provide greater stand off and firepower to meet emerging threats.”

Dan Olson, vice president and general manager for the armament systems division of Orbital ATK’s defense systems group, highlighted almost 2,000 MK44s have been installed internationally.

“Our MK44 is sought after for its proven reliability and effectiveness by our allies fielding new systems or needing to upgrade existing platforms to meet growing threats. Our guns represent a commitment to working together with our nation and our allies to create and deliver superior armaments and services for those who defend their nation’s security,” he said in a statement.

The Israeli Ministry of Defense awarded Israel’s Elbit Systems Ltd. [ESLT] a contract worth about $100 million to supply advanced radio systems, the company said March 22.

Under the contract Elbit will manufacture and provide hundreds of radio systems over five years. The company did not specify the precise number of radios ordered. Elbit will provide the Israeli Defense Forces (IDF) with hand-held, vehicle-mounted, and airborne third generation Software Defined Radios (SDRs), which allow advanced network services at a high security level.

Elbit also expects to receive an additional order to provide repair and maintenance service of the radios over 15 years. Maintenance activity will be performed under an outsourcing model as part of the ministry’s strategy to establish a full array of radio systems at high operational availability while significantly reducing maintenance expenses, Elbit said.

As part of this order, the company said it will expand its manufacturing and maintenance site in Arad, Israel to include up to 100 employees.

“We are very proud of this award, reinforcing our strategic partnership with the city of Arad on the one hand and with the IDF on the other. Employing 100 workers in Arad is in line with Elbit Systems’ strategy to enhance our presence in Israel’s peripheral areas,” Bezhalel (Butzi) Machlis, president and CEO of Elbit Systems, said in a statement.

“We have many years of experience in managing outsourcing projects in Israel and abroad, in radio communications as well as other military fields, and I am confident this experience will enable us to provide the IMOD with a top quality highly operational solution for a cost effective price,” he added.