Military Capabilities

Options for the evolution of NATO

26 August 2014

NATO is facing considerable uncertainty, challenges, and significant changes in 2014. The alliance is drawing down in Afghanistan after 12 years of operations, gearing up to meet the challenges posed by a resurgent Russia, and dealing with the implications of an increasingly disparate and competitive security environment. The NATO alliance faces various possible trajectories towards a status of being ‘robust and resolute’, ‘retrenched and reactive’, or ‘inert’.

The immediate challenge for NATO is to conclude a successful drawdown in Afghanistan.

The NATO-led International Security Assistance Force (ISAF) mission is scheduled to conclude at the end of 2014, to be replaced by the approximately 12,000-strong “train, advise, and assist” mission, Operation Resolute Support.

The ISAF mission under NATO since 2003 has achieved mixed results, and will conclude despite the presence of a capable Taliban insurgency. The US Department of Defense’s 2013 Report on Progress towards Security and Stability in Afghanistan noted, “The Taliban retain access to critical resources and maintain the freedom of action essential to their continued survival and ability to threaten [the Afghan government].” Moreover, the political environment remains uncertain and unstable.

A NATO recommitment to combat operations in Afghanistan is politically and operationally unlikely. However, NATO and countries in the broader region, including Russia, must consider the possibility of a polity and society in Afghanistan incapable of withstanding possible contested run-off election results in June; an overlapping rise in Taliban insurgent activity; a decrease in Western military and intelligence assets to counter this activity; diminished NATO political will to continue combat operations; and increased efforts by Afghanistan’s neighbours to restrict the flow of refugees from Afghanistan.

The drawdown in Afghanistan and a host of emerging challenges have come during a period of transition for NATO as it approaches the October 2014 change in leadership from Secretary General Anders Fogh Rasmussen to former Norwegian prime minister Jens Stoltenberg. Moreover, the summit in Cardiff on 4-5 September represents a platform for discussion of the changes required to meet the current and longer-term challenges facing the alliance.

Facing the future

The unfolding crisis in Ukraine has complicated NATO’s challenge to redefine itself for a new environment. The alliance has been effective in reassuring its allies in Eastern Europe and the Baltic region through increased military deployments and exercises. Ten states, including NATO partner Sweden, have deployed military aircraft as part of efforts to increase air patrols in the Baltic and Eastern Europe.

However, it is not certain how the situation in Ukraine will develop or how long NATO can afford to sustain its increased deployment and operational tempo in Eastern Europe. Supreme Allied Commander Europe General Philip Breedlove noted in mid-April that offers of assets to Eastern European allies “are immediately available across the range of air, land, and sea operations through 31 December”.

However, Ukraine must be viewed within the context of a broader Russian challenge in Eastern Europe that is unlikely to dissipate on 31 December. Russia is operating with increased confidence and assertiveness in the former Soviet space and continues to invest heavily in military modernisation and defence capabilities. Russian defence spending doubled between 2007 and 2013 and will have tripled from 2007 to 2016, according to IHS Jane’s Defence Budgets analysts.

NATO’s ability to affect Russian decision making in Ukraine has been limited to date as most of the levers available to the alliance and its member states are diplomatic and economic and will be most intensely felt by Russia in the longer term. Its lack of ability to deter Russia from irredentism in non-NATO Eastern Europe is likely to stimulate thinking within the alliance about diplomatic and military measures that can be taken to ensure a more robust deterrent before there is another crisis in Eastern and Southern Europe.

However, Russia and Afghanistan are not the only security challenges to NATO or its individual members, many of which are focused on out-of-area and non-traditional threats and challenges that have roots outside NATO’s boundaries, but also have direct effects on European and North American security.

North Africa and the Middle East are of particular concern for Turkey, Western European, and Mediterranean allies, as well as the United States. Political instability, poorly governed spaces, insurgent networks, Iranian nuclear negotiations, and the armed conflict in Syria create immigration, proliferation, and extremism challenges that, as US chairman of the joint chiefs of staff General Martin Dempsey noted on 14 May, could “quite profoundly change life inside... not only southern Europe, but well into central and northern Europe”.

Washington’s rebalance to Asia will also have an effect on NATO and its available resources. The US ability to pivot towards Asia has been questioned by many of its Asian partners, but it remains a core principle of US president Barack Obama’s foreign policy, and could distract the US from European security challenges while also increasing NATO’s strategic military interest in the Asia Pacific region.

In addition, NATO is increasingly being forced to invest in the capacity to deal with cyber security and the targeting of critical national infrastructure, for example by establishing the NATO Cooperative Cyber Defence Centre of Excellence (NATO CCD COE) in May 2008 and subsequently running regular cyber defence exercises.

Perceptions of the importance of the full range of challenges and threats facing NATO will vary across the alliance. Reconciling the varying perspectives of the 28 member states is the core structural challenge facing the alliance.

Transatlantic divergence

Military capabilities and political will within member states to sustain large deployments and endure armed conflict have suffered as a result of the 12-year conflict in Afghanistan and chronic under-spending on defence, especially in Europe. Only two NATO member states – Poland and Estonia – are among the countries worldwide with the 20 fastest rising defence budgets from 2012 to 2014, while 12 NATO member states and two European partner states are among those with the 20 fastest shrinking defence budgets between 2012 and 2014. The result of this persistent under-investment in Europe in particular is a sizeable capability gap between the US and its NATO allies that will have to be addressed through increased and co-ordinated European defence spending as the US reduces its military presence in Europe in order to concentrate on Asian security and the Middle East.

Budget issues have also affected US defence spending and force structure, as total defence spending has decreased by 16.9% in nominal terms since 2010, according to IHS Jane’s Defence Budgets. However, a more prominent concern than the reduced budget is the uncertainty of whether sequestration of the US budget in 2013 will take full effect in 2016 and exactly what resources the US Department of Defense will have available to support which force structure. Resolution of this political and budgetary uncertainty in the US is a critical first step in projecting the future forces NATO will have at its disposal.

Despite recurrent concerns about the mismatch between US and European defence spending, NATO has proven itself an impressively resilient alliance over its 67-year history, having endured several intra-European and transatlantic rifts, such as the Suez Crisis of 1956, France leaving the integrated military structure in 1966, the Iraq War in 2003, and the ongoing debate about mass communications surveillance caused by the unauthorised disclosures of former National Security Agency contractor Edward Snowden.

Nevertheless, solidarity between the US and its European allies has suffered in the past decade from the lack of a coherent mission. The conflict in Afghanistan was never able to play a galvanising role, as the difficulty and duration of that conflict served to enervate political will rather than energise allies.

Russia’s resurgence in the former Soviet space, as well as its increased assertiveness in East Asia, may serve as the catalyst for this enhanced sense of common purpose, but NATO will still need to find a way to develop leadership structures that are not rooted in US dominance of the military alliance.

Future scenarios

A spectrum of alternative futures is plausible in the complex strategic context facing NATO, ranging from a robust and resolute alliance at one end, through a retrenched and reactive alliance, and on to an inert alliance.

A ‘robust and resolute’ organisation will require characteristics that include shared leadership (and agreement) between the transatlantic partners. The US is unlikely to be able to balance its European, Middle Eastern, and Asian commitments fully while still enduring the budgetary uncertainty and political stagnation currently dominating US politics.

European actors will be required to play a more prominent leadership role both politically and militarily, including allies such as Poland or the Baltic states that have fewer resources but perhaps a much stronger focus on a specific category of threats of interest to NATO. Transatlantic solidarity and an enhanced sense of shared purpose will also be critical for a successful alliance.

At this end of the spectrum there would have to be an increased investment in defence capabilities. For European states to take on more of the alliance’s military burden, many states will be required to spend more on defence. As Rasmussen noted on 15 May 2014 at the Bratislava Security Conference, “Every ally is expected to play its part toward contributing to our shared security ... we have to invest more in defence.” Co-ordination of spending and on decisions across the alliance about the types of capabilities that should be developed will also be a characteristic of the ‘robust and resolute’ scenario.

The final characteristics marking this end of the spectrum would be organisational and technological innovation, and a commitment to and vision for NATO as an alliance with broad geographic interests. The current strategic context will not persist for a Cold War-like four-and-a-half decades, so flexibility in and innovation about alliance structures and relationships will be required. Similarly, a focus on technological innovation and efficiency will be necessary to make sure that the money NATO states do spend on defence and security will be maximised and that NATO allies and partners maintain a technological advantage over their perceived competitors across all domains, including in disruptive technology areas such as cyber capabilities and unmanned systems.

A robust and resolute alliance would also seek to meet threats beyond the borders of Europe and North America, and seek to anticipate and deter these threats rather than be optimised only to respond to them.

Several possible manifestations of a robust alliance exist, but perhaps the most effective one is a segmented and matrixed alliance. In this future iteration of NATO, the alliance would progress towards being an institution comprised of multiple small and plausibly overlapping groups of states bound either by common geography or shared perceptions of specific threats – such as the Russian threat to Eastern Europe and the Baltic states, or North African security – or interests. These states would work together to prepare and execute multilateral defence.

This model for NATO would require central co-ordination of missions, strategy, and resources, and would seek to establish some degree of presence in, or access to, regions where NATO perceived its interests and security were most threatened, including in the Middle East, Asia, and, plausibly, the Arctic, in addition to NATO’s core commitments in Europe. The issue-focused groups of states would work together with a centralising command, to develop the appropriate capabilities and interoperability.

Such a decentralised future for NATO has important implications for structure and membership. It ultimately could imply a much more flexible and tiered alliance consisting of core members with core commitments of mutual self-defence, plus varying degrees of partners enjoying different levels of access to and interactions with NATO.

This future for NATO is not without vulnerabilities, of course, and could stretch NATO too thinly, particularly if US budget sequestration and domestic politics combine to appreciably erode US military power, and European states are unable to increase investment in defence.

However, the biggest risk is the possibility that the varying filters of NATO members and partners would not be used to build a more flexible structure, but would detract from alliance unity and solidarity, leading to a fragmented alliance in which NATO becomes retrenched. Its organisational structures, and predominant focus on the threats and challenges emanating from Russia and within the European context, would be at risk if NATO became fragmented.

Such a posture could lead to more unilateral, bilateral, or multilateral actions by NATO member states operating outside the alliance, similar to French interventions in Africa. Certainly, periodic unilateral interventions are not inconsistent with NATO’s charter, but a sense that NATO is unwilling or unable to pursue security interests outside Europe could lead to an increase in these types of deployments at the expense of alliance cohesion and credibility.

Another possible scenario for a retrenched alliance would be that of a manic alliance making decisions at Cardiff that would then be seen primarily as reactive to the current Ukraine crisis and designed to dissuade Russia from further irredentism in the short term, but that would have long-term consequences that are either not fully understood, or on which NATO and its member states may not be fully prepared to follow through.

NATO enlargement, particularly the membership accession plan for Georgia, could have immediate and long-term consequences. A membership accession plan for Georgia would bring NATO to Russia’s border and may be the appropriate decision for NATO and for Georgia. However, any move to bring Georgia into NATO would trigger moves by Russia to undermine Georgia’s candidacy. NATO would be likely to have to waive its concerns around admitting members with existing border disputes, as maintaining this stipulation would give Russia a de facto veto over Georgia’s membership. Moreover, it would test NATO’s commitment to its newest aspirant member.

The figurative and rhetorical battle lines are already formed ahead of Cardiff. Rasmussen’s intentionally noncommittal public statement on 14 May that Georgia’s “remarkable progress” should be reflected “appropriately” at the Cardiff summit led to statements from Russian foreign minister Sergei Lavrov that “attempts to draw this country [Georgia] into NATO would be very negative for the entire system of European security”.

Similarly, NATO could be seen by Russia as confrontational as it seeks to reassure and re-engage states such as Moldova that are not on NATO’s current shortlist of aspirants and are presumed targets for enhanced Russian influence in the region.

The starkest outlook for NATO is one in which the alliance makes few changes to its structure and loses significant credibility due to rapidly deteriorating security situations in Afghanistan and Libya.

This inert alliance would maintain a capability to defend its members and carry out limited operations, but would find itself increasingly reactive to events and marked by an absence of dynamism, innovation, shared leadership, and flexibility.


Many of the challenges NATO has faced in 2014 are likely to intensify or accelerate over the rest of the year and into 2015. These challenges will warrant attention and action both individually and collectively to ensure that NATO continues to play a stabilising role in Afghanistan and Eastern Europe, and meets the demands of a changing security environment.

These challenges are also likely to drive consideration of changes to NATO’s structure and alignment. This is not the first time in NATO’s 67-year history that the alliance has had to contemplate new structures and approaches in response to new environments. Indeed, NATO’s founding was the result of the acknowledgement of a radically changed security reality after the Second World War.

The decisions taken at Cardiff and the aftermath of the summit will mark the third time since the end of the Cold War that NATO will have to reconsider its strategic context and mission: from a decade of reshaping the post-Cold War security environment in Eastern and Southern Europe, to a dozen years fighting extremism, terrorism, and other transnational threats abroad, to the current turning point.

Without a coherent – albeit risk-burdened – framework like the one developed in response to the Cold War, the challenges and threats to NATO and its allies and partners are unlikely to stabilise, much less harden, in a way that will eliminate the need for flexibility in alliance mentalities, structures, and capabilities.

Discussion of the future of NATO will require a common assessment of the threat levels and risk tolerance levels of a large number of allies and partners, as well as politically difficult decisions, increased European leadership and capabilities, and a US that is still engaged in North Atlantic security. Ultimately, it will require an enhanced degree of realism and vision about what NATO can and should be in an uncertain and complex environment.

IHS is launching a NATO Futures research program in September 2014 that will deliver completely new, forward-leaning analysis to help military, security and risk professionals anticipate emerging transatlantic security challenges and opportunities and create strategies to mitigate risks and capitalize on opportunities in these environments.

Delivered as a comprehensive report, the program will incorporate best-in-class data, information and insight to identify critical risks and uncertainties within the changing strategic context that confronts NATO, and forecast a range of distinct alternative futures for the structure, membership, leadership, capabilities and mission of the Alliance.

If you are interested in learning more about the NATO Futures research program, or if you are interested in purchasing the NATO Futures report, please contact us with the reference “NATO Futures”.

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