EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP92S00238R000200050017-6
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 27, 2016
• Document Release Date: January 8, 2013
• Sequence Number: 17
• Publication Date: June 22, 1985
• Content Type: OPEN SOURCE

Declassified and Approved For Release 2013/01/08: CIA-RDP92SO0238R000200050017-6
EUROPE
Per 'ardware ad astra
When President Reagan first put forward
his radical idea of an anti-missile system
in space, America's west European allies
tumbled over themsleves to find a com-
mon response. That was in March, 1983,
and the Europeans are still tumbling.
Ministers and businessmen are making a
frantic last-moment effort to come up
with a joint European position in time for
the Milan summit of the European com-
munity which begins on June 28th.
Europe has hung back partly because
American ideas about the Stra-
tegic Defence Initiative have
themselves been changing: with
all but the most starry-eyed SDI
enthusiasts, the heady promise
of a seamless anti-missile um-
brella in space has given way to
a more manageable step-by-step
research programme designed
to find ways of protecting specif-
ic targets from missile attack.
But the Europeans are torn
even about even this stripped-
down version of SDI.
Where Europeans stand on
star wars depends a lot on where
they sit. Governments agonise.
But European businessmen are
keen on the idea, even if there is
not all that much money for
them in SDI research, at least
not right away.
Now that both Americans and
Europeans have refined their
views of SDI, Europeans are no
longer seriously worried that the
Americans might retreat from
the defence of western Europe behind a
for-Americans-only nuclear shield in
space. But the British and the French are
afraid that enthusiasm for SDI could
before long undercut the arguments for
keeping their own nuclear deterrents.
Most European governments also worry
that SDI might obstruct an arms-control
agreement with the Russians. If the Rus-
sians offered to make deep cuts in the
missile arsenals in return for ditching
SDI, many west Europeans would want
the Americans to say "yes".
Despite all these ifs and buts, the
European governments recognise that
Europe could fall even farther behind in
the technology race if its defence indus-
tries do not get into the space defence
business. And they are anxious about the
future of Europe's space scientists and
engineers. Unless these people are given
work in Europe, by one means or anoth-
er, American companies are liable to
steal them away over the Atlantic. It was
partly nervousness about such a brain-
drain that prompted President Mitterrand
of France to suggest a high-tech pro-
gramme of space research, Eureka, which
Europe could pursue while the Ameri-
cans went after their SDI.
The commercial bait
The lure which the Reagan administra-
tion is dangling over Europe is a share in
the $30 billion it wants congress to allo-
cate to SDI research in 1985-89. Europe-
an businesses would like to get what they
can. But American researchers will inev-
itably get most of the money, partly
because Europe's high-tech strengths do
not lie in big-dollar projects but more
because American research laboratories
and defence companies have much more
muscle in Washington. So the immediate
pickings for Europeans and other foreign-
ers such as the Israelis and the Japanese
will be, small. But the non-Americans
want to be in on a high-tech boom in the
1990s .if SDI does take off.
So far, the only American SDI money
actually spent in Europe has gone to a small
French company for a piece of electronics
equipment not available in America. But
several research contracts for European
firms are now being drawn up and may be
announced within a few weeks. Here is a
short-list of European things which are
already making American eyebrows cock
with interest:
? high-quality optical equip-
ment, which several European
firms such as Zeiss or Leitz in
West Germany and Oldelft of
Holland are probably better at
than their American rivals
(some British companies that
specialise in hand-ground lenses
come into the field too);
? advanced computer software
of the kind being produced by
the British company Scicon;
? a high-velocity anti-missile
rocket (research on this is being
done by two British firms,
Shorts of Belfast and Hunting
Engineering, and by the British
military research establishment
at Fort Halstead in Kent);
? advanced electronics, where
Philips of Holland, Marconi,
Ferranti and Racal of Britain
and Selenia of Italy want to see
what they might get out of SDI;
? sensor technology and pro-
pulsion systems, on which Eu-
rope's aerospace heavyweights-British
Aerospace, Matra, Aerospatiale, Messer-
schmitt-Bolkow-Blohm, Dornier, Fokker
and Aeritalia-would all be able to work.
Wish lists are not contracts, however.
Even eager European businessmen face
problems. One is the attitude of their
governments. Strictly speaking, the gov-
ernments have no say in the decisions of
private companies. Even with state-run
ones in France and Italy, the official
approach is "let the companies decide".
But nobody really believes that. The
Declassified and Approved For Release 2013/01/08: CIA-RDP92SO0238R000200050017-6
 Declassified and Approved For Release 2013/01/08: CIA-RDP92SO0238R000200050017-6
EUROPE
Is the Eurofigh ter doomed?
The doctors have given the clinically
dead European Fighter Aircraft project
another month before they unplug its
life-support machine. The British,
French, West German, Italian and Span-
ish defence ministers, conferring in Lon-
don on June 17th-18th, tried once again
to get life into the idea of a shared five-
country fighter-bomber. They failed, but
decided to keep it breathing by. agreeing
that their industries should produce yet
another study by the middle of July.
The industries themselves are at a loss
to know what more they are to study.
The differences of opinion about the
proposed new aircraft, which was sup-
posed to be available in the mid-1990s,
are perfectly clear. The defence minis-
ters claim to have narrowed the gaps
during the London meeting, but they
admit they have not eliminated any.
France is still the odd man out.
The French want a smaller, cheaper
aircraft than either West Germany or
Britain needs. They insist on having
leadership of the design team. They want
a larger share of the work than is justi-
fied by the number of aircraft they
intend to buy, arguing that France will
do most of the selling overseas.
Some of these differences might in
theory be compromised away, although
compromise has eluded the ministers for
more than a year. Others cannot. Either
one country leads the programme, or
else a costly supranational organisation
must be created to manage it. The three-
country Tornado aircraft programme
poured millions, unnecessarily, into su-
pranational management. France's insis-
tence on leading the new project with its
own industry may be unpalatable, but it
makes economic sense.
This week's meeting came close to
giving up the five-country idea and going
ahead without France, but the ministers
wanted to appear to be having one more
go. The intention now is that those
countries which can manage to agree
with each other, in a meeting to be held
in Bonn, will proceed with a shared
aircraft. France will almost certainly
drop out and will probably build its own
machine. About the best anybody is
seriously hoping for now is that the two
designs might use a?few common parts.
Munich-based Messerschmitt-Bolkow-
Blohm firm does four fifths of its business
with the West German government. Nat-
urally, the company listens to what the
government wants.
At a meeting in Bonn on May 13th, the
chancellor's chief of staff, Mr Wolfgang
Schauble, told businessmen and research
scientists he had asked in to talk about
SDI that it was up to them whether they
worked for the Americans or not. But, he
added, West German SDI work ought to
be "co-ordinated". In other words, no
free-market scramble. But West Germa-
n's federal system makes an intriguing
wrinkle: Bavaria -owns 7% of MBB and
Baden-Wurttemberg owns 4% of Dor-
nier. Not surprisingly the. premiers of
these states, Messrs Franz Josef Strauss
and Lothar Spath, are both keen advo-
cates of SDI.
Finance ministers tend to eye any new
spending item coldly, and one big -reason
46 for European hesitation is cost. In partic-
ular, the West Germans and the Italians
are afraid that, once European compa-
nies embarked on star-wars research paid
for by the Americans, they would quickly
come asking for contracts from their own
governments too. According to the Ital-
ian prime minister's foreign affairs advis-
er, Italian companies are unlikely to sign
American contracts unless they get incen-
tives and research loans from the Italian
government. But the issue is not simply a
battle between spending ministries and
treasuries. European defence ministers
must ask themselves whether star-wars
research will drain money away from
western Europe's non-nuclear defence.
Have the Europeans found it?
Europe's decision about SDI is compli-
cated by Eureka. This French idea was
meant as an alternative to SDI. Its pur-
pose, as outlined, was civilian. But many
of the things European Eureka research-
ers would be working on-advanced soft-
ware, high-speed computers and ways to
protect both these things from the effects
of hurling them into space-would be
precisely the things their American SDI
counterparts are looking into.
A natural-looking division of labour
suggests itself. America concentrates on
SDI, Europe on Eureka; and, to create a
two-way street, both do a bit of each. Mrs
Thatcher in Britain and Mr Kohl in West
Germany seem to like this idea. The snag
for Eureka is that rightly or not European
businessmen believe they can already
sniff American 'star-wars money. Eureka,
they suspect, would be simply a new
name for existing European programmes.
Mr Umberto Agnelli, the deputy chair-
man of Fiat, has voiced this scepticism:
"The American project is operational",
he said, "Eureka is not".
West Germany
Unhappy returns
Businessmen, politicians and newspaper
barons in West Germany tend to be a
mite too cosy with each other for their
own and for the public's good. So at least
critics of the West German establishment
frequently complain. Whether or not
their view is wholly just, the resignation
on June 14th of the federal government's
spokesman, Mr Peter Boenisch, is almost
certain to give it fresh currency. -
Before joining the government in 1983,
Mr Boenisch was a senior editor in Mr
Axel Springer's conservative press em-
pire. Like many successful West Ger-
mans, he had business interests on the
side. No harm in that, perhaps, except for
the small matter of his tax returns.
The day after Mr Boenisch stepped
down, it became known that the federal
authorities in West Berlin may ask him to
pay as much as DM500,000 ($165,000) in
unpaid taxes and a possible fine of
DM1m. Mr Boenisch's tax difficulties, it
seems, involve his earnings from two
Swiss-based public-relations firms with
car-industry clients, in which he had an
interest before joining the government.
According to Bild, a mass-circulation
newspaper which Mr Boenisch once edit-
ed, one of his more regular clients was
Daimler-Benz, the maker of Mercedes
cars. Mr Boenisch's partner, who died in
1977, tested cars for a West German
television channel.
Mr Boenisch's resignation was front-
page news throughout West Germany,
and not only in his old paper. The white-
haired, 58-year-old spokesman is well-
known for his free-spending style as well
as for his pungent, bass-voice presenta-
tions of government policy. His attacks
Declassified and Approved For Release 2013/01/08: CIA-RDP92SO0238R000200050017-6