Exports in the Integrated Review, Defence Command Paper and Defence and Security Industrial Strategy

Written by Pardeep Ruprai, Industry Secondee to ADS

During March 2021, the Government released its Integrated Review (IR), Defence Command Paper and Defence and Security Industrial Strategy (DSIS). Whilst the IR does not focus on defence and security exports specifically, it sets out the vision for a Global Britain, including the much-discussed Indo-Pacific Tilt and the policy shift away from the UK’s 2012 policy of ‘global competition by default. In turn, the Defence Command Paper and DSIS cover the details on export policy. The trio of papers herald a newly energised approach towards supporting UK defence and security exporters, with the DSIS signalling a movement towards opening export opportunities and exploring new ways in which UK exports can be developed.

Defence Command Paper

The Defence Command Paper highlighted the Indo-Pacific region as an area critical to the UK economy, our security, and our global ambition to support open societies, building on the geopolitical decisions made in the IR. The Government will develop capability partnerships and support UK prosperity by strengthening defence exports. Additionally, alongside industry, the Government are refreshing the Defence Growth Partnership’s strategy on exports and economic growth. Finally, there will be investment into the UK Defence Solutions Centre to improve the quality of information on the UK defence sector and potential opportunities in the global market.

Defence and Security Industrial Strategy

The DSIS emphasises the importance of the export market to our national prosperity, highlighting that the UK is the world’s 2nd largest exporter of defence goods and services. Additionally, according to UKDSE’s latest export statistics the UK is the 4th largest security exporter. In policy terms the DSIS specifically looks at the area of international cooperation, exports and foreign investment.

In support of this, the UK Government has promised to develop new government-to-government commercial mechanisms to enhance defence and security exports and ADS is currently seeking further details from UK Defence and Security Exports (UKDSE) on how this will operate. This proposal will be welcomed by industry, given the central importance of committed government-to-government engagement for expanding market access for UK exporters. Members believe that G2G arrangements that include industry as a fundamental part of that relationship result in much more productive and long-lasting commercial relationships between those nations and can help to break down barriers to entering sensitive national security markets.

It is promised that this new mechanism will be accompanied by behavioural and structural changes to better promote cross-government collaboration. This was a core priority for ADS members during the DSIS consultation process and ADS will be working closely with the MOD, Home Office and Department for International Trade to promote a ‘Team UK’ approach.

Alongside the measures above, there will be a “transformation programme by the Export Control Joint Unit to improve transparency and the customers experience for exporters.” This is in line with the UK Government’s effort to improve the export licensing system and involves input from subject experts, industry, and allies to ensure efficiency. It is vital that the UK continues to operate a rigorous, effective and robust export licensing regime, with both UK industry and the ECJU working closely to ensure compliance with regulatory requirements and that UK defence exports are ethical and legal.

Finally, the DSIS confirms that as part of the DIT’s Export Academy, a Defence and Security Faculty will be established. This will give SMEs access to regional, financial, and political expertise to enhance their position overseas. This will entail general advice regarding exports, how to conduct business overseas, sources of funding and events, and exhibitions to pursue specific opportunities. ADS will be closely observing how the Defence and Security Faculty operates in practices but believes this should be a useful mechanism for SMEs when navigating overseas market opportunities.