The US defence industry: Open or shut to foreign competition?

Abstract

As in other countries following the end of the Cold War, the US defence industry is facing swingeing change, with companies having to readjust to the economic and defence consequences of shifts in ‐ public policy and reductions in government spending on arms. President and Congress have introduced policy initiatives reallocating slimmer funds, while companies seek workable strategies for the future. Gary Pagliano looks at the impact of these new policies, how they can be implemented and what obstacles may need to be overcome, highlighting in particular the Perry initiative for greater allied cooperation, allowing increased foreign investment and access to the US market. The effects of these necessary changes have yet to be felt, but a complex blend of protection, cooperation and competition will probably be the driving factors for some years to come as governments and allied defence industries strive to come to terms with change.