The U.S. and British defense industries must work closely together to develop business opportunities at home and abroad in an environment of tightening military spending, a senior British trade official said this week.
“It is only natural that their industries work closely with each other,” Richard Paniguian, the head of the Defense & Security Organization of the UK Trade & Investment Organization, said at the Association of the United States Army (AUSA) exposition in Washington recently.
The United States and Britain are “allies everywhere in the world,” and that partnership should translate to enhanced cooperation in industry to develop technologies and programs for domestic and international markets, Paniguian told a small group of reporters.
Paniguian, whose agency is tasked with seeking out opportunities for British defense exports, said he is concerned that looming reductions in U.S. defense spending could dampen the market for his country’s producers. Budget cuts will require firms to innovate to adapt to the changing fiscal environment, he said.
British defense companies “will find the going a lot harder,” he said. “We have to be particularly agile, foresighted and quicker on our feet.”
With diminishing spending, Paniguian said he is urging the British defense sector to seek out other global markets, including in emerging economies in the Group of Twenty (G- 20) and World Trade Organization (WTO).
“We are going to have to look to other parts of the world to ensure we maintain production volume,” he said.
Britain is second to only the United States in defense exports and accounts for 21 percent of the international market, he said. Britain last year exported some $9.3 billion in defense goods and $3.1 billion in security equipment.
Britain in 2006 formed a network for small-and medium-sized domestic companies involved in the defense sector. Known as the Ballistic Tool Kit, or BTK, the goal of the 45-firm group is to pool their resources and capabilities to appeal to the wider and more demanding requirements of potential customers.
BTK was making its U.S. debut at AUSA in an effort to demonstrate the network’s capabilities and present it to U.S. industry and defense officials, Paniguian said.
Formed in 2006, BTK offers systems ranging from night vision to sniper equipment, advanced training, consulting and testing of systems. BTK was created so firms can support each other in creating new business opportunities and technologies, Paniguian said.
“They fight as a pack,” he said.