Report

NATO DEFENCE COLLEGE

The visit began with briefings at NATO Defence College (NDC) in Rome. Lt. Col. Mario Masdea, Chief of Public Affairs Office, briefly introduced the history, mission and organisational structure of the College. The NDC was opened in 1951 and its mission is to prepare selected officers and officials for important NATO and NATO-related multinational appointments and to conduct academic studies and research in support of the Alliance’s wider goals. Research and studies at the College are focused on strategic rather than tactical and operational levels.

In his presentation, Dr. Karl-Heinz Kamp, Research Division Director, discussed the development of the NATO New Strategic Concept. He stressed that a new Strategic Concept is needed due to important changes in the strategic environment. The new Strategic Concept will need to account for the challenges of globalisation as well as the fact that many new threats are global in nature. It should address the issue of “body bags” – NATO has to explain to the public why dangerous operations need to be undertaken even when they put lives at risk.  Thus, the new Strategic Concept should address not only policymakers and experts, but also the general public. Furthermore, it will have to reassess the activities of the Alliance in the context of the economic recession and account for falling defence budgets in the Alliance. Finally, the document should be as short as possible and focus only on the most important issues, including the question of the Alliance’s identity, its efficiency as well as its legitimacy (is NATO authorised to do what it wants to do?).

With regard to specific topics, the new concept should focus on the political element of the transatlantic relationship. NATO must strengthen its role as a real transatlantic forum. While recognising new threats such as terrorism or regional instability, the concept will need to keep Article 5 as the core of the Alliance working. Relations with Russia will remain on an important level, but should not be allowed to divide the Alliance. New NATO countries still perceive Russia as a threat and they need assurances, even if they are symbolic ones, such as the existence of contingency plans to defend them against hypothetical attacks. NATO should also develop its capacity to deal with matters related to energy security and climate change, but the Alliance must clearly define what NATO can really achieve in these areas. Dr. Kamp also challenged NATO to begin a serious discussion on the role of nuclear weapons in the Alliance strategy. Are US nuclear weapons deployed in Europe still relevant to collective security? The speaker noted that the act of drafting the new Strategic Concept may be as important as the final draft. The document should not be seen as a panacea and as a replacement for the difficult decisions that national parliaments and governments will have to make on security issues.

During the discussion, members of the delegation questioned whether an Alliance of 28 nations can work efficiently and develop a common identity. Dr. Kamp suggested that the Alliance is indeed too big to ever become a “global cop”. On the other hand, the Allies share a common notion: the idea of “the West”, which places a particular emphasis on liberal democracy, a market economy and pluralism.

MEETING AT THE UNITED NATIONS FOOD AND AGRICULTURAL ORGANIZATION (FAO)

The FAO has placed food security matters at the centre of its agenda and has recently held meetings on meeting the planet’s food requirements in 2050. There are an estimated 1.02 billion hungry people in the world today and while Sub-Saharan has the highest percentage of hungry people, Asia and the Pacific have more hungry people in absolute numbers—642 million people. There are also 15 million hungry people in developed countries and 53 million in Latin America. The numbers of the hungry have increased rapidly in recent years.  Before the current crisis, the global number of hungry people stood at 850 million, which was considered the baseline figure. Significantly higher investment in agriculture will be needed simply to return to that baseline figure. 

High prices have been the key driver in the recent food crisis.  Global economic growth had led to steady improvements in food security. Yet important structural changes including urbanization and significantly altered dietary patterns have also played a role. It is also true that commodity prices have risen even more than retail food prices, which are driven by a range of other factors. US and European consumers thus saw less food price rises than many in the developing world.

There has been a long-term decline in agricultural investment since the green revolution. This had begun to put some pressure on global cereal stocks. In 2005 and 2006 there were also weather-related shocks and rising energy costs, which pushed up the cost of fertilizer and food transport. At the same time and due to significant subsidies, the emerging bio-fuel industry began to leave its mark on food commodity prices as did exchange rate volatility. The global financial crisis has exacerbated these trends with rising capital costs, falling trade, reduced employment and income and falling remittances. All have contributed to hunger.

Food security is a function of resources, technology and the yields that farmers can achieve. Access to food is obviously essential, but high costs can reduce access.  Rising food prices reduce the purchasing power of the very poorest people.  Health and access to water are also critical. If people do not have access to clean water, they confront trouble in absorbing nutrients.

The impact of biofuels on food prices has been very difficult to gage; estimates vary widely. The World Bank has suggested that three quarters of recent price rises can be attributed to the diversion of food and security into biofuels, while the US Council of Economic Advisors suggests that only 3% of the price rises can be attributed to the biofuel market.  Most other estimates are in the range of 25% to 40%.

Food demand is rising most quickly in the developing world, which has also undergone the most rapid population increase.  Cities are also growing more quickly than the countryside and this too has important food security implications.  By 2070, food demand will increase by 70%.  In order to meet this increased demand, higher levels of investment in agriculture research and production will be essential.  It is also important to recognize that margins for increasing yields are far higher in the developing world than in the developed world.  Yet, in a country like Kenya, which has significant agricultural potential, farm yield growth has been flat. It needs investment capital, improved agricultural education, infrastructure and organizational change to bolster production significantly. There are also important questions about how to phase in changes. At early stages of development, funds are needed for research, infrastructure and education. At an intermediate stage, the emphasis should be on market development and later stages the focus should shift to value addition, and risk and quality management. This implies that the role of the state and the market can evolve over time.

The FAO’s Committee on World Food Security has sought to bring together world leaders to deal with food security issues. That Committee had become a somewhat peripheral institution, but the current crisis has raised its prominence. A recent set of reforms seeks to make the CFS as the central platform for achieving global food security responsible for coordinating national and regional food security programs.

Water issues were also discussed. It is important to recognise that one calorie of food requires one litre of water in the production process. Food production is thus highly water intensive, and the global warming and population growth are seriously straining water supplies.  Meat diets are more water intensive than vegetable diets, and as countries like China develop, their meat consumption increases accordingly.  This will add to their water crisis. Bio-fuel production has now also become a competitor for water while urbanization and industrialization often leads to a degradation of water quality.  All of this requires new and comprehensive strategies to conserve water and to use it in a far more efficient fashion.  Technology will have to be part of the solution, and efforts will be needed to develop crops that are less water intensive.

MEETING AT BOCCONI UNIVERSITY

Bocconi is a leading private non-profit university based in Milan. It was Italy’s first university to grant degrees in business and the school hosted a discussion with the delegation on the global financial crisis. That discussion was led by Professor Bruni.

The financial crisis began in the summer of 2007, and the liquidity crisis that resulted lasted for one year. It began in the United States and then spread to the rest of the industrialized world. The problem originated in the sub-prime real estate market in the United States, but those assets were spread throughout the rest of the world and so the consequences were global in nature.  The circulation of credit fell drastically and this had the effect of cutting off the blood supply of the global economy. The countries that suffered the most were those that traded the most. Very strong reactive policies carried out by governments and central banks have helped to rebuild confidence and improve expectations for the future.  The consensus forecast is that the situation is now stabilizing, although at a low level.  In this view, the world should have recovered within two years. The growth rate of emerging economies will be a critical factor in the recovery.  Dr. Bruni, however, suggested that the outlook might not be as rosy as the consensus view seems to suggest.

There are two broad interpretations of the crisis. One suggests that the crisis emerged from a failure of supervision, while a second view suggests that the problem was essentially macroeconomic in origin. The failure of the supervision theory suggests that markets assumed too much risk, and that central bankers were not able to understand the degree of risk in the economy. The macroeconomic approach focuses more on the imbalances between a highly leveraged and deficit ridden United States and an over saving Asia.

In fact, interest rates have been very low for a very long time and this led to a high degree of speculative behaviour. US deficits co-existed with cheap credit and this, in turn, lowered the pressure for adjustment. The bubbles thus grew larger.  At one point, the US balance of payments deficit reached an unsustainable 6% of GDP.  China was accumulating claims on the United States and spending very little of its own income. This had a profound impact on banking systems. Politicians in the United States wanted to artificially support the rate of growth and thus were very unwilling to change these policies.  So in many respects, the crisis, in part, reflects an overarching political failure.

The absence of regulation allowed this state of affairs to go on far too long. Europe here is very much part of the problem.  The Euro is now an international currency but Europe still does not have common banking regulations.  New supranational bodies will be needed to ensure that policy is far more tightly coordinated.  A financial stability board consisting of the world’s major regulators has begun to elaborate new rules of the game.  The IMF should take more responsibility in macroeconomic planning.  The problem is that politicians have been slow to embrace a more supranational regulatory order. Politicians do not like to cede power, but there may be no choice.  These are the real solutions to the problems we have confronted. The medicine so far has attacked the manifestations but not the source of the problem.  This view was challenged by some in the delegation, who worried that there can be no solution by creating unaccountable international organizations.

Finally, it is possible that western countries have gone too far in bailing out the banks. These policies have pumped up the prices of financial assets and banks have made excessive profits. Stock prices also rising too quickly and this too may not prove unsustainable. Were the market to crash again, the recovery would stall.  The W-shaped recovery is thus not beyond the realm of possibility.

MEETING AT THE ITALIAN SENATE

At the Italian Senate, members met with Senator Mario Baldassarri, who suggested that the economic outlook over the near term is not as promising as some have suggested. Unemployment is likely to only peak in 2010, although GDP is likely to begin to recover. The Chinese economy is likely to return to 9% growth rates and the United States  may achieve 2% growth next while Europe will lag behind at 1.5 -2%.  However, the crisis is not yet over as the real roots of the crisis have not been addressed.

Indeed the crisis began in the real economy and not in the financial realm as such. This is a crisis that is linked to US overconsumption and over savings in China.  US current account deficits were approaching 6% of GDP, and this was utterly unsustainable. This dynamic has raised important questions about global macro-economic governance. Rules are needed to ensure financial stability; China’s currency ought to be allowed to rise against the dollar. The current peg is making more fundamental macro-economic adjustment difficult.    These adjustments must be made as soon as possible. As part of this process, China should begin to focus on domestic development and reduce its stress on exports.  Its hinterlands should be developed to provide an alternative to the huge migration to the coastal cities that has been underway for some time. Europe will need to speak more coherently in order to defend its interest during this period of transformation. Monetary management poses yet another challenge for Europe as the Maastricht deficit limits constitute something of a blunt tool. Senator Baldasaari suggested, for example, that those limits do not distinguish between investment and consumption.  A “Maastricht 2” agreement might be needed which, for example, would allow those countries operating a current account surplus greater flexibility on the budget.

Italy faces a range of economic challenges related to its large government debt due to a tendency to run budget deficits.  Italy, however, has benefitted from the very high savings rate of its people and those savings have helped underwrite the debt. By contrast, US consumers themselves confront high personal debt levels and are not in a position to purchase government debt, which is rather underwritten by Asian savers.  The United States has been consuming upwards of 6% more than what it produces and this suggests that US spending is unsustainable at current tax rates.  Eventually the United States will either have to increase savings or reduce taxes.  If the United States is tempted to cut back on defense spending in this process, Europe will be pressed to pay more for defense.  In Europe taxes today stand at roughly 45% of income as opposed to 35% in the United States.  Europe may need to cut taxes while the United States increases them.

THE WORLD FOOD PROGRAM

The World Food Program (WFP) has a very large share of its personnel working in the field, many in very dangerous locations like Somalia and Afghanistan. The briefing in Rome took place soon after five WFP field workers were killed by terrorists in Islamabad, Pakistan. Members of the delegation expressed their condolences to Josette Sheeran, Executive Director of the United Nations World Food Programme, and to her staff.

NATO has become a closer partner to the WFP in Somalia and in Afghanistan insofar as is providing some degree of security needed to conduct critical food delivery operations.  NATO is escorting WFP ships that are currently feeding 3 million people in Somalia alone.  Without those escorts, millions would go hungry. The WFP needs to raise its operating budget annually and is predicting funding shortfalls over the coming months.

The WFP oversees some 150 charter ships moving food to various ports. This is a massive logistics operation and Djibouti has become a key port for the WFP. The WFP also manages a large number of air transport missions including strategic airlifts to disaster struck areas. Road transport poses another set of logistics challenges.  The WFP is managing large humanitarian relief depots where relief materials are stored both for the WFP, other UN bodies and for NGOs.

It is essential to highlight the link between food security and peace in Afghanistan. This country is highly fragile and meteorologically vulnerable.  It is landlocked and subject to a number of import controls.  Half of the Afghan people live below the poverty line and many lack regular access to food.  At the current moment, the WFP is the only humanitarian organization operating in all 34 provinces with an extensive network of offices. WFP leaders are convinced that an effort is needed to bolster agricultural productivity in Afghanistan and is working with the FAO in order to help the country in this area.  Last year the country enjoyed a bumper harvest although many did not benefit from them.

Ms. Sheeran told the delegation that terrorism often begins where the roads end and she noted that 80% of the WFP staff is operating beyond the road’s end.  The WFP stands by people when no other institutions are willing or able to do so.  The WFP is, for example, feeding up to ten million people in Pakistan today, although it will not feed combatants where it operates. In Afghanistan the WFP is feeding some 40% of the population. Because of the record harvest, the WFP is now able to buy Afghan produced food for distribution to those in need.  The United States has also made local purchases and this is an excellent means of bolstering farmers’ incomes and encouraging production.

EUROPEAN SPACE RESEARCH INSTITUTE (ESRIN)

The NATO PA delegation also visited the ESRIN, known as the ESA Centre for Earth Observation, one of the five European Space Agency (ESA) specialised centres situated in the town of Frascati. Simonetta Cheli, Head of the Earth Observation Coordination Office, Earth Observation Programmes Directorate, briefly introduced the ESA and ESRIN. She stressed that ESA is primarily engaged in civilian activities, but also contributes to crisis management and maritime security endeavours. ESA has designed and tested over 60 satellites. The Agency is also involved in activities such as Earth Observation, development of the Galileo (Europe’s own global navigation satellite system), development of space launchers and telecommunication systems. ESA offers tools to implement EU’s space policy.

ESA is an intergovernmental organisation of 18 European states that have space expertise. The ultimate goal is to involve all EU member states. ESA's headquarters are in Paris. ESA’s mandatory activities are funded by a financial contribution from all the Agency’s Member States, calculated in accordance with each country’s GDP. In addition, ESA conducts a number of optional programmes. Each Member State decides in which optional programme they wish to participate and the amount they wish to contribute. ESA's budget for 2009 is €3.5 billion.

ESRIN is one of the centres of ESA. It manages ESA’s Earth Observation Programmes. It also hosts the project team managing the Vega small-launcher programme.

Henri Laur, Head of the Earth Observation Missions Management Office, said that ESRIN particularly prides itself on ENVISAT Earth observation satellite, launched in 2002, which carries sophisticated optical and radar instruments to provide continuous observation and monitoring of the Earth's land, atmosphere, oceans and ice caps. Data retrieved by ESRIN has a number of practical applications: for instance, information on sea ice movement or sea pollution hotspots is important for calculating ship routes. Satellite data also provides insights into factors contributing to climate change. ENVSAT data is used by a number of organisations, including the NATO Undersea Research Centre.

A number of other satellites are in preparation that will have more specific tasks, such as measuring the thickness of the Arctic ice or to gather data on Earth gravity. The goal of Earth Observation Missions is to facilitate access to Earth observation data for scientific and other relevant organisations. Most of the information is provided free of charge.

Thomas Beer, GMES Policy Coordinator, introduced the Global Monitoring for Environment and Security (GMES) programme. GMES is a manifestation of ESA entering into an area of defence and security. GMES has three components: data retrieval and sharing services, in situ data collection (measurements taken from instruments carried on aircraft, floating in the oceans or positioned on the ground) and the space component. The latter will be significantly strengthened by the deployment of five Sentinel satellites, providing the all-weather, day and night radar and high-resolution optical imaging for land, ocean and atmospheric monitoring services. These services will bring a broad range of socio-economic benefits and will provide policy makers with information on which to base decisions on issues relating to natural resource management, food security, biodiversity and air-quality forecasting. GMES data can also be used in humanitarian crisis support and rescue missions as well as to improve maritime security. In particular, the GMES’s MARitime Security Service project (MARISS) offers integrated monitoring maritime security services in different European regions using satellite Earth Observation (EO) data combined with in situ observation data to support improved decision-making on maritime security. The services take the form of vessel detection reports (maps) and support clandestine immigration control and illegal traffic control. Moreover, the space component of GMES is designed to contribute to enhancing security in space, namely by collecting data on space debris and retired satellites orbiting our planet.

Gordon Campbell, Earth Observation Science, Applications And Future Technologies Department, provided some concrete examples of GMES activities, including detecting significant crop losses in some regions facing the risk of starvation; helping international organisations to identify the most suitable places for refugee camps in Darfur (near food and water sources); tracking the source of oil spills at sea; detecting anomalous concentrations of small vessels that could be used to transport illegal immigrants or for other malicious activities; etc.

During the discussion, Lord Jopling (United Kingdom) asked if GMES can be employed to track pirates operating off the coast of Somalia. Mr. Campbell replied that monitoring small pirate vessels might not be effective because their intentions often cannot be established until they actually make an attack. Monitoring pirate mother ships, on the other hand, could be extremely helpful for anti-piracy operations. Some delegation members also asked about cooperation between ESA and NATO. ESA representatives said some contacts exist, particularly with NATO Joint Air Power Competence Centre (JAPCC) and NATO Undersea Research Centre, but the cooperation is still not very mature due to the fact that ESA only recently embarked upon programmes relating to the field of defence and security.

Sergio Vazzana, Earth Observation Mission Planning Manager, introduced ESA activities in implementing the International Charter “Space and Major Disasters”. Several nations offered some of their satellite and other related capabilities to the Charter to detect and analyze data and to relay it to relevant parties on a short notice. The Charter focuses on natural and man-made disasters, including earthquakes, volcano eruptions, floods, landslides and oil spills. The Charter is being activated about 40 times a year. For example, during the flood in France in September 2002, ESA was able to acquire, analyze and relay data and prepare relevant complex maps in the course of two days. Also, when the oil tanker Prestige sank in 2002, ESA helped to understand the extent of the spread of the oil spill, enabling responsible structures to react properly.

ALENIA AERMACCHI – FINMECCANICA GROUP

The NATO PA delegation also visited the Headquarters of Italy’s leading defence aerospace company Alenia Aermacchi, a part of the Finmeccanica Group. President of the Company Giorgio Brazzelli and the Managing Director Carmelo Cosentino welcomed the delegation and briefly introduced the company’s history and goals. Founded in 1913, the company designed and developed its aircraft autonomously with highly qualified personnel and leading-edge technologies. The company’s revenues in 2008 were 274 million Euros. It has almost 2,000 employees and the company is present in more than 40 countries. Throughout its history, Alenia Aermacchi has built over 7,000 aircraft, including sea planes, fighters and jet trainers. It currently focuses on its flagship – M-346 Master, the only new generation advanced/lead-in fighter trainer currently available in Europe. The aircraft is tailored to train pilots to fly new generation combat aircraft and is well suited for every phase of advanced and pre-operational training, to reduce the flight hours on the more expensive aircraft. This aircraft is now ready for the market and the demand is very high. M-346 is competitive in terms of price, which is extremely important in the context of shrinking defence budgets. Alenia Aermacchi’s believes that M-346 training system is a serious candidate for setting interoperability standards for NATO aerial operations.

The delegation had the opportunity to observe M-346 aircraft in action as well as to visit aircraft production and assembly facilities.

EXPO 2015 IN MILAN

Milan was successful in its bid to host the 2015 Universal exposition. Its theme is “Feeding the Planet, Energy for life”. The NATO PA delegation met with organizers of this important event. Universal expositions are organized every five years. The 2010 Expo will take place in Shanghai and it will focus on the quality of life in large cities. Lucio Stanca, CEO of Expo 2015, stressed that agriculture, food and nutrition will be crucial issues for the 21st century. Organising the universal expo is a formidable challenge.  The expo will feature thousands of events between April-October 2015. 21 million visitors are expected, 15 billion Euros will be invested, 70,000 jobs will be created locally and the economic benefits for Milan and its region are expected to reach 44 billion Euros.

Representatives of the organising team provided in-depth information on Expo 2015 and explained the choice of the theme. Food is the engine of life. Man is an integral part of nature, but to feed himself man exploits the land and other creatures, transforming the natural environment. Therefore, the key objective is to direct human activities in a way that ensures food security while promoting rational use of energy and environment.

Expo 2015 will seek to highlight the role of research in improving the quality of food. It will explore the dynamics of technological innovation in the supply chain of each country, promote the goal of safeguarding biodiversity, stress the importance of education in eating decisions and behaviour, examine the relationship between food and health, and show how eating habits express and embody culture.

The site of Expo 2015 will consist of five large climate-controlled greenhouses that will reproduce the Earth’s main biomes.

Adriano Gasperi, Scientific Committee, Expo 2015, discussed the importance of science for the Expo 2015. He stressed Milan Expo will provide an important occasion to examine the state of the art of scientific and technological research, offering a global stage for discussion open not only to scientists but also to the public at large. The scientific community is actively involved in developing the sub-themes for the event.

NATO UNDERSEA RESEARCH CENTRE (NURC)

NATO PA delegation travelled to La Spezia and visited the NATO Undersea Research Centre (NURC). Dr François-Régis Martin-Lauzer, Director of NURC, introduced the centre and described its role in support of NATO's operational and transformation requirements. In particular, the centre focuses on the undersea domain and on NATO transformation in the field of maritime security. NURC maintains a strong reputation for bringing scientists together through rotational scientific staffing and through extensive partnering with NATO member nations. Within NATO structure, NURC is subordinated to the Atlantic Command Transformation. Currently, NURC employs 67 scientists; its annual budget is more than 30 million Euros. Although the Centre is relatively small, its importance is increasing in the context of shrinking national defence research programmes in a number of NATO nations.

With a staff of scientists and technologists from NATO nations and a fleet of state-of-the-art unmanned vehicles, research vessels, equipment and facilities, NURC offers a range of services from basic research and development to at-sea testing and validation. Since 2004, NURC has been advancing technologies for protection of ports and for maritime security. Members of the NATO PA were given a close-up look at some of these new technologies, and were also treated to a demonstration of an interesting approach used by the US Navy for port protection - the use of sea lions. Trained to find objects and underwater intruders, sea lions have extraordinary underwater vision and agility. They are able to detect undersea objects and assist in their recovery by tagging these objects and even attaching a clamp connected to a cable. They can actually be trained to arrest intruders.

The latest technologies in port and harbour security include the use of unmanned vehicles for the detection, identification, and disabling of intruders or explosive devices above or below the surface. For this meeting, NURC’s fleet of unmanned underwater vehicles (UUVs) was on display. UUVs range in size from 1-7 meters and are capable of carrying advanced sonar equipment, which can provide detailed images of the undersea environment. Unmanned surface vehicles (USVs) are also part of NURC’s fleet for harbour protection research and were shown in operation during the harbour security demonstration. Unmanned surface vehicles can be part of a detection and response system against underwater intruders. Unlike unmanned underwater vehicles, which are limited in the amount of data that can be transferred through the water, surface vehicles communicate easily through regular in-air communication channels. Development of unmanned systems, according to Dr. Martin-Lauzer, is extremely promising in the context of two major problems the Alliance is facing: shrinking defence budgets (these systems are increasingly low-cost) and the number of human casualties in NATO operations.

LIGURIAN DISTRICT FOR MARINE TECHNOLOGIES (DLTM) AND LA SPEZIA PORT AUTHORITY

In La Spezia, the Assembly delegation met with representatives of DLTM and La Spezia Port Authority. Lorenzo Forcieri, President of La Spezia Port Authority and former Vice President of NATO PA, said that the Ligurian region is the hub of Italy’s marine research and development sector. DLTM, established in 2008, is designed to bring together academic, industrial and military entities as well as state and regional authorities to develop a competitive maritime sector, to promote scientific innovation and to foster regional economy in general, focusing in particular on small and medium enterprises. DLTM also seeks to enhance co-operation with similar techno poles in Europe.

The NATO PA delegation visited La Spezia harbour by boat and were briefed at the Port Authority. Mr. Forcieri pointed out that La Spezia is the second largest port in Italy with an annual throughput of 18.6 million tonnes. The port is well connected to land transportation networks. The new port Master Plan, adopted in 2007, includes not only further development of the merchant port, but also focuses on boosting shipbuilding and cruise industry as well as on enhancing environmental stewardship. Total investment according to the Master Plan amounts to 370 million Euros. Mr. Forcieri also described in detail the measures taken by the Port Authority to increase port security, including a cooperation agreement with relevant US authorities and the acquisition of the modern monitoring, detection and scanning technologies for cargo as well as biometric identification system for people accessing the harbour.

Respectfully submitted,

Mr. Leon Benoit, M.P. Chair Canadian NATO Parliamentary Association (NATO PA)