Britain's new prime minister wins first defense victory amid Farnborough: Canada joins GCAP program
Kyiv • UNN
Canada has joined the GCAP fighter program as an observer, marking the first expansion beyond the founding countries. This is part of European allies' efforts to reduce dependence on American weapons.
The new UK government secured its first defense victory on Tuesday, as Canada joined the delayed GCAP fighter jet program, part of broader efforts by European allies to reduce their dependence on American weapons and military technology, Reuters reports, writes UNN.
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This move coincides with the Farnborough Airshow, the main event for the aerospace and defense industry, where wars in Ukraine and the Middle East are boosting demand for tools ranging from combat drones and interceptor missiles to AI-based military software.
The airshow coincides with the first days in office of the new UK Prime Minister Andy Burnham. He appointed John Healey, who advocates for increasing the UK defense budget, as Chancellor of the Exchequer, and tasked Health Secretary Wes Streeting with defense.
These appointments on Tuesday boosted the share prices of British defense and aerospace companies, as markets bet that companies will benefit from the new government's willingness to make Britain more war-ready.
"I look forward to working with him in his new capacity," Rolls-Royce CEO Tufan Erginbilgic told journalists at the exhibition on Tuesday, referring to Healey. "He understands Rolls-Royce and our agenda, as well as how significant our contribution to the country is."
The new government's first statement regarding foreign partners concerned the Global Combat Air Programme (GCAP), a stealth fighter jointly developed by the UK, Italy, and Japan. Canada joined as an observer, marking the first expansion beyond the founding countries.
BAE Systems, Boeing, and Saab also signed an agreement to promote a partnership to offer the UK a new high-speed jet trainer for pilots based on the Boeing T-7 system, as it seeks a replacement for its aging Hawk fleet.
Earlier, Healey had lobbied the former prime minister for months to develop a path to spending 3% of GDP on defense by 2030, rather than the 2.68% the government ultimately planned.
"As Defense Secretary, John Healey championed British business, recognizing the contribution the defense sector makes to growth and national security," said BAE Systems CEO Charles Woodburn.
Canada is becoming an increasingly important defense partner for European countries, as it seeks to diversify its defense spending away from the United States and establish closer ties on the continent, the publication writes.
Observer status does not entail any financial obligations, but Canada could join the program more formally in the future, sharing the billion-dollar development bill and potentially ordering aircraft, the publication notes.
Defense sector companies made up half of the record 1,600 exhibitors at this year's show, underscoring a shift from the usual dominance of commercial aviation and reflecting how conflicts have changed spending priorities, the publication notes.
In the commercial sector, aircraft manufacturers Boeing and European rival Airbus announced hundreds of aircraft orders at the show, despite some tension over delays and industry bottlenecks that have affected some airlines.
Reuters also reported that Boeing has asked the US government to pressure the European Union for transparency regarding a €3 billion ($3.43 billion) loan package for Airbus, reigniting trade tensions after both sides extended a tariff truce on jet subsidies.
US Trade Representative Jamieson Greer told CNBC on Tuesday that the Office of the US Trade Representative (USTR) is looking very closely at the loan issue.
"We cannot accept a situation where companies are not required to operate under market systems, where Boeing must work and compete with Airbus, which receives unfair loans," Greer said.
Emirates President Tim Clark also criticized aircraft and engine manufacturers, stating that he expects the delayed Boeing 777-9 widebody aircraft to be delivered in the second quarter of next year, as it approaches certification.
"We were supposed to receive them in April 2020... so if we get them in the second quarter of 2027, that would be too risky under any circumstances," he said, adding that the delays mean the aircraft risks being technologically obsolete even before delivery.
"At some point, we will have to draw a line," he indicated.
The U.S. Federal Aviation Administration told Reuters on Monday that it expects certification of the aircraft by the end of this year or early next year.