Italy defence procurement, arms counter-trade and weapons exports

OPSSG

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Italy as a weapons design powerhouse — Part 1

1. According to an Oct 2020 CSIS brief on Europe between 2007 and 2019, Italy experienced twenty quarters of recession (42% of the time). The Italian defense budget:

(a) steadily fell from 1.3% of GDP in 2011 to 1.1% in 2017. In 2019, it rebounded to €21.4 billion ($24.5 billion), or 1.22% of GDP; but​
(b) rose by 9.6% in 2020 to €15.3 billion (US$18.1 billion), with the procurement budget emerging as the big winner as it rose by 26% from 2019 if coupled with top-up spending from the industry ministry​

2. While personnel costs represent more than 70% of the Italian defense budget (compared to 40% in the UK or 50% in France and Germany), most of the prior budget cuts were to military investments. Despite the above, Italy has the ambition to build its own NFHs, LUHs, PPAs, submarines, and collaborate to build up its capability to dominate in the electromagnetic spectrum. Thanks to Italian domestic ship building capability, Fincantieri has been able to win 4 billion Euro of orders for naval vessels by Qatar, including four corvettes, an amphibious ship and two patrol boats being built in its La Spezia shipyard until 2024.

3. Italy managed to maintain a high level of investment in some strategic sectors — including current plans:
(a) of the Italian Ministry of Defence (Italian MoD) to work with its Austrian counterpart on a bilateral co-operation programme on the future procurement of military rotorcraft by the Bundesheer to select the Italian-built Leonardo AW169M light utility helicopter (LUH);​
(b) to launch with France, the Sicral-2 / Syracuse 3C military satellite. This is a joint Italian-French programme based on a geostationary satellite operating in the UHF and SHF bands. It will enhance the “milsatcom” capabilities already offered by Italy’s Sicral 1 and Sicral 1B satellites, and France’s Syracuse-3 System;​
(c) to deliver on 22 Dec 2020, the 1st two M-345 High Efficiency Trainers to the Italian Air Force (which has a requirement for up to 45 aircraft to replace the MB-339s);​
(d) to induct 7 Pattugliatori Polivalenti d’Altura (PPA) class multi-role vessels by 2026; and​
(e) to build the Near Future Submarine (NFS). Currently the backbone of Italian Navy’s (Marina Militare) submarine force are four Type-212A submarines. These are equipped with fuel cell Air Independent Power (AIP), which makes them among the most stealthy submarines anywhere. But the Type-212A is best known as a German design, not Italian. In many respects the NFS is a return to the proud tradition of fiercely independent Italian submarine building.​

The NFS will be a direct development of the Type-212A. Although the baseline Type-212A is largely a German design, Italy was a partner in the program. In a cost-conscious defense collaboration typical of the post-Cold War ’90s, Germany was to build six boats and Italy four. Italy’s were built locally by Fincantieri and incorporate some local systems. In particular they are armed with the Italian Whitehead A184 Mod.3 and newer Black Shark heavyweight torpedoes. And they carry an array of unique special forces equipment.

 
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OPSSG

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Italy as a weapons design powerhouse — Part 2

4. In the Italian Defense Policy program for the JAMMS (aka Joint Airborne Multi-sensor Multi-mission System):

(a) will be structured in two or more tranches — as part of the Italian Defense Policy Document for 2020-2022. The first one, worth 1.2B Euro, covers the acquisition of the first two JAMMS G550 and six “green” airframes that can be converted at a later stage to either JAMMS or CAEW configurations, together with logistic and infrastructural support;​

(b) is meant to fulfil both the C4ISTAR and CAEW requirements. According to some analysts, the decision to get six non-equipped aircraft could be due to the G550 going out of production in 2021 (when the final aircraft is delivered). Italy has already received 2 CAEWs from IAI; the Italian program will eventually be for 4 more JMMS and 4 CAEWs are set to start in 2021. All 10 of these modified Gulfstreams will be based at Pratica di Mare Airbase, near Rome; and​

(c) whose designation is still unknown (supposedly E-550B or R-550), will be in charge of the actualization of the Italian national intelligence database, characterization of tactic intelligence targets, search for new targets of interest, survey of the operational environment of deployed forces, targeting process support, airborne early warning and electromagnetic surveillance and protection.​

5. Starting in 2016 and following the publication of its 2015 White Book, the Italian to MoD ultimately decided to substantially increase its equipment expenditure, which now represents more than 20% of its defense budget, compared to less than 10% in 2015. Major domestic defence equipment manufacturers in Italy include Alenia Aermacchi, Leonardo, Fincantieri‎, MBDA, Elettronica, Beretta, and Iveco Defence Vehicles.
(a) On 27 Jan 2021, the Italian Army received its first 12 light tactical armored vehicles LMV 2 (Italian military designation : VTLM 2 NEC) manufactured by Iveco Defense Vehicles; under the Forza NEC program with new network-centric control systems at the squad, platoon and company levels. In fact, the first vehicles under this contract were delivered to the Italian Ministry of Defense back in Nov 2018, but their equipping with NEC (Networked Enabled Capability) systems and their fine-tuning delayed the delivery to combat units for another two years. The LMV 2 vehicles supplied to the Italian army are equipped with a Leonardo Oto HITROLE Light RWS (with the installation of a 7.62 or 12.7mm machine gun or a 40mm automatic grenade launcher) and 8 smoke grenade launchers.​
(b) The LMV 2 is a 8,100 kg, 5 seater that is powered by the new Iveco F1C 220hp diesel engine (instead of 182 hp), a new 8-speed automatic transmission ZF 8 HP 90S and a 2-speed transfer case. The LMV 2 vehicle has a payload of 1,500 kg (40% more than that of the LMV) and an automatic transmission control system. The maximum speed is 110 km / h. The LMV 2 has a reinforced suspension and a new electrical system. The Italian army plans to purchase 2,000 LMV 2 units with a production run until 2034.​

6. Italy has been able to leverage domestic procurement into international weapons sales in the US and elsewhere. These successful Italian exports include the induction of:
(a) the Boeing MH-139A Grey Wolf to replace the UH-1N fleet by the USAF (based on the successful Leonardo AW139 design);​
(b) the NH90s by the Qatar Emiri Air Force (of which 12 NH90 NFH are being built in Leonardo’s Venice Tessera facility). These NFH configuration helicopters are equipped with MBDA's Marte ER anti-ship missiles;​
(c) advanced jet trainers by a host of countries that include 12 M-346s by Singapore, 16 M-346 "Bielik" by Poland, and 12 M-346s by Azerbaijan (that are built by Alenia Aermacchi with a sidewinder armed, Fighter Attack version also being developed for another unconfirmed customer);​
(d) the Constellation-class frigate by the US Navy (based on the successful Fincantieri Orizzonte class design); and​
(e) the BAE Systems Amphibious Combat Vehicle by the US Marines (based on the successful Iveco SuperAV design).​

In this regard, I note that in Dec 2020, Leonardo has announced the delivery of the 1st of 17 HH-139B helicopters to the Italian Air Force, a customised variant of the bestselling AW139 platform, from its facility based in Vergiate. The helicopter will be operated by the Italian Air Force’s 15th Wing which is in charge for search and rescue (SAR) duties and supports the national community in case of disaster relief operations. This latest Italian Air Force’s programme brings the total number of AW139s chosen by all of these Italian Government operators to nearly 80, covering a wide scope of public utility roles including law enforcement and homeland security, patrol, special operations and anti-terrorism, SAR, fire-fighting, command and control, government/VVIP transport, disaster relief and training.

7. In Sep 2020, Israel’s Ministry of Defense announced a reciprocal procurement agreement with Italy’s defense ministry that will see Israel acquire 12 August Westland 119KX training helicopters and Italy receive Rafael Advanced Defense Systems Spike missiles and Elbit Systems simulators. The agreement builds on a 2011 deal between Israel and Italy in which Israel purchased 30 M-346s (10 of which are to be transferred by Israel to Greece) and Italy purchased an Israeli observation satellite and two G550 CAEWs.

8. Italy has taken delivery of 15 F-35 aircraft including 12 F-35A’s and 3 F-35B’s. Final assembly of the aircraft occurs at Italy’s own facility at Cameri Air Base in the north of the country, which is due to become a maintenance hub for the aircraft. Italy’s defense minister has thrown his weight behind the F-35 program to counter demands from within his coalition government to suspend purchases of the aircraft to help Italy’s coronavirus-stricken economy. Lorenzo Guerini said he “confirmed that the program would continue.”

9. During 2019 there were authorizations to armaments export for a total of 5.17 billion Euro, substantially in line with 2018 (slight decrease of -1.38%) thus stabilizing on a constant level of exports after the peaks of authorizations started in 2015 (8.2 billion in that year and then 14.9 billion in 2016 and 10.3 billion in 2017). However, this is 80% more than the values of 2014, so it can be said that the record exports in the three-year period 2015-2017 have dragged the orders for the Italian military industry to an average level higher than that of the beginning of the century, with as many as 84 recipient countries (since 2015 there are now more than 80 total destinations).

10. The country receiving the largest quota of Italian weapons export licences is Egypt with 871.7 million Euro (in particular to supply 32 helicopters produced by Leonardo spa) followed by Turkmenistan with 446.1 million Euro. In third place is the United Kingdom with 419.1 million Euro in total and in fourth place we find the USA with 306.1 million Euro. But exports to Egypt will soon be eclipsed by deliveries to Qatar by 2024.
 
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kato

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2. While personnel costs represent more than 70% of the Italian defense budget (compared to 40% in the UK or 50% in France and Germany), most of the prior budget cuts were to military investments.
Budget percentages are not really comparable between countries. For example in Germany that 50% number does not include pension cost for former military and civilian personnel - including that (and it should be, it's a formal part of the budget) the personnel cost is closer to 65% of the overall budget.

Italy by comparison however cross-finances a lot of current procurement projects partially from the budget of other ministries - over the last couple years the share of the Ministry of Economic Development (MiSE) has accounted for between 50 and 70% (!) of military procurement for example.
(b) to launch with France, the Sicral-2 / Syracuse 3C military satellite. This is a joint Italian-French programme based on a geostationary satellite operating in the UHF and SHF bands. It will enhance the “milsatcom” capabilities already offered by Italy’s Sicral 1 and Sicral 1B satellites, and France’s Syracuse-3 System;​
Sicral-2 was launched in 2015, and effectively replaced Sicral-1 back then. The current project in Italy, the future replacement of Sicral-1B, is part of the European Union's GovSatCom initiative for pooled governmental satcom capacities. Italy signed a 300 million Euro procurement contract for that with Thales Alenia Space and Telespazio in 2019.
 

Sandhi Yudha

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So the UAE’s eviction of Italian aircraft and personnel from a key military base has been linked to Italy’s decision in January to place an embargo on the sale of munitions and missiles to the UAE and Saudi Arabia due to concerns over the Gulf states’ military campaign in Yemen.

I wonder about the Falaj 2 patrol boats procurement, the UAE ordered four of them. The Falaj 2 class is a class of stealth missile patrol boats designed by Fincantieri and based on the Italian Diciotti-class offshore patrol vessel, in use with the Italian Coast Guard.

The choice was between defence contracts + to be allowed to station troops in UAE, and human rights. The Italian politicians have chosen for the second option.
 
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OPSSG

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Budget percentages are not really comparable between countries. For example in Germany that 50% number does not include pension cost for former military and civilian personnel - including that (and it should be, it's a formal part of the budget) the personnel cost is closer to 65% of the overall budget.

Italy by comparison however cross-finances a lot of current procurement projects partially from the budget of other ministries - over the last couple years the share of the Ministry of Economic Development (MiSE) has accounted for between 50 and 70% (!) of military procurement for example.
Thanks for the concise explanation.

The choice was between defence contracts + to be allowed to station troops in UAE, and human rights. The Italian politicians have chosen for the second option.
I don’t know about if further Falaj 2 vessel production has been interrupted but I know that Italy’s intelligence services has lost a valuable source of air intelligence of Iranian activities in both the Gulf of Hormuz and the Red Sea — which UAE would have been willing to assist in facilitating such collection plans.

IMO, the Europeans are more keen on arms embargoes than the Americans and now that the UAE has access to 50 F-35As worth US$10.4 billion and 18 MQ-9B worth US$3 billion in UAVs, and missile and bomb sales worth US$10 billion, American arms sales to UAE will grow in the days ahead. The Europeans who lack geopolitical awareness seem to be keen sell arms; but not keen to continue arms sales once weapons are actually used in war.
 
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kato

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So the UAE’s eviction of Italian aircraft and personnel from a key military base has been linked to Italy’s decision in January to place an embargo on the sale of munitions and missiles to the UAE and Saudi Arabia due to concerns over the Gulf states’ military campaign in Yemen.
The eviction is about being able to kick the Italians while they're still there.

The sole function of Al-Minhad was as a logistics turntable for Afghanistan. Since the Italian deployment in Afghanistan is formally ending by the end of the month with all troops withdrawn, it's quite foreseeable that they would have left Al-Minhad relatively soon despite the couple hundred million Euro they've invested into military infrastructure over the past two decades in the UAE.

I know that Italy’s intelligence services has lost a valuable source of air intelligence of Iranian activities in both the Gulf of Hormuz and the Red Sea — which UAE would have been willing to assist in facilitating such collection plans.
TFA Kuwait, TFA Djibouti, the Italian Cell at CAOC Al-Udeid... it's not like Al-Minhad is the only air base Italy operates from in the area.
 

ngatimozart

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AW249 attack helicopter accelerates into flight-test campaign | News | Flight Global
Flight testing for the Italian Army's next gen Attack Helicopter to replace the AW129 is well under way. The AW249 is expected to enter service in 2025 with a requirement for 48 Helicopters.
Looks quite interesting but I thought that they would have gone with a 30mm cannon instead of the 20mm one. I understand that the 20mm is the Italian Army decision based on equipment already held.
 

SolarisKenzo

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@SolarisKenzo You have forgotten something. Early Christmas celebrations??? :D Merry Christmas and please remember to add some original text next time.

Ngatimozart.
 
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SolarisKenzo

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Italy and France announced a joint order for 700 Aster 30 missiles, unknown version ( likely to be a mix of 30 and 30B1 ) for 2 Billion euros.

MBDA also currently working on providing CAMM-ER missiles for Italian Navy and possibly other European navies

 

SolarisKenzo

Well-Known Member

More news about the mega-contract between OCCAR and EuroSam.
- Update and new missiles for Horizon class destroyer ( ITA/FRA )
- Update to SAMPT-NG standard and new missiles for the land batteries ( ITA/FRA )
- New order for five SAMPT-NG batteries by ITA air Force
- Production of Aster 30B1 NT, Aster 30B1 and Aster 15 for the navies ( ITA/FRA )

More details as they come out...
 

ngatimozart

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Staff member
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Italy and France announced a joint order for 700 Aster 30 missiles, unknown version ( likely to be a mix of 30 and 30B1 ) for 2 Billion euros.

MBDA also currently working on providing CAMM-ER missiles for Italian Navy and possibly other European navies

The Chilean navy and RNZN use the Sea Ceptor as well.
 

swerve

Super Moderator
Brazil has ordered it for its new Tamandaré-class frigates,, Poland has selected it for its Miecznik class frigates (Arrowhead 140/Type 31), Canada's selected it for the Canadian Surface Combatant (Type 26), & Pakistan is reported to have selected CAMM-ER for MILGEM (Turkish design) corvettes.

The UK, Poland & Italy (ER) have ordered it for land-based use, & it's in service with the UK & Poland. Brazil is reported to have selected it for the Brazilian marines.

That's eight countries & 14 armed services.

[Edit]
Add the Saudi navy - Missili CAMM per le Multi-Mission Surface Combatants saudite
 
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Redlands18

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