France plots next-gen future

In 2024 the new F4 standard of the Rafale is set to be operational. Credit: VanderWolf Images/Shutterstock

T​​​​​​​s global security threats mount, France is poised to increase its defence budget to $57.6bn by 2028, focusing on modernising its military through procurement programmes like the SCORPION programme and new fixed-wing fighters.

France is charting a steady course for its defence budget, with projections indicating an increase from $47.1bn in 2022 to $57.6bn by 2028, GlobalData’s intelligence on the French defence market reveals. This growth, though modest compared to the dramatic leaps seen in recent years, is indicative of France's commitment to modernising its military capabilities and preparing for high-intensity conflicts.

As highlighted by GlobalData's "France Defense Market 2023-2028" report, the French Government has set an ambitious plan under the Military Planning Law 2019–25, further defined by a new Military Planning Law in 2025. Despite an anticipated deceleration in annual growth to a compound annual growth rate (CAGR) of 2% from 2024 to 2028, down from 7.1% between 2019 and 2023, the overall trend remains positive.  

Key among France's defence initiatives are procurements and future programmes. One of the flagship projects is the SCORPION programme, an endeavour to upgrade the French Army's land systems. This initiative, driven by the need to counter peer-level adversaries, includes developing and acquiring next-generation armoured vehicles and land systems, such as the Griffon VBMR and the Jaguar EBRC.

The SCORPION programme, managed by a consortium of French defence businesses – Arquus, Nexter, and Thales – modernises equipment and integrates digital systems to improve battlefield communication and coordination.

Tristan Sauer, aerospace, defence, and security analyst at GlobalData, states: "France's long-term strategic military goals as outlined in recent defence procurement legislation include supporting European security objectives, maintaining deterrence and enabling France to maintain expeditionary capabilities to support its interests overseas (as seen recently in Africa and the Asia-Pacific)." 

Another procurement angle that the French industry is impacting is the French Air Force, where France is investing in next-generation fighter jets. The modernisation plan includes the acquisition of advanced Rafale jets from indigenous defence company Dassault Aviation, ensuring that the French Air Force remains capable of undertaking missions ranging from air defence to deep strike operations, as well as maintaining a defence aerospace industrial capability.

The new F4 standard of the Rafale, which is expected to officially enter service this year, will include new and upgraded capabilities, including radar sensors, multifunction optronics, weapons systems, helmet-mounted displays (HMDs), and networking capabilities, as highlighted by GlobalData's intelligence on the French defence market.

In other recent procurement decisions to enhance its Air Force and keeping in line with leveraging aerospace and defence businesses in France, the French Ministère des Armées committed €1.2bn ($1.3bn) to Airbus Defence and Space for upgrading and supporting its fleet of A330 MRTT tanker transports. This contract includes advanced connectivity, self-protection systems, and integration into the Future Combat Air System (FCAS), with enhancements starting in 2028.

"We thank the French Ministry of Armed Forces for its continued trust in the Airbus A330 MRTT, and we are honoured to contribute to one of France's most strategic capabilities through this programme," said Jean-Brice Dumont, Head of Military Air Systems at Airbus Defence and Space, at the time.

In procurement developments exemplifying the enhancement of its Navy, France has achieved several milestones in the last year. Firstly, the French Navy prime Naval Group unveiled the third Barracuda class of six nuclear attack submarines. The French Navy also received the addition of the nuclear attack submarine Duguay-Trouin to its fleet, the second of the same series of submarines. This programme aims to replace the ageing submarines of the Rubis class in service with the French Navy.

Naval Group also began construction of the largest submarine ever built in France for the French Navy, the third-generation nuclear-powered ballistic missile submarine (SNLE 3G). France announced that it would develop four third-generation nuclear-powered ballistic missile submarines (SNLE 3G) to replace the four Le Triomphant-class (SNLE 2G) SSBNs currently in service from 2035.

The SSBNs will incorporate technology from over 200 French defence firms and specialist institutions, as highlighted by GlobalData’s intelligence on the French defence market. 

Tristan Sauer underscores a critical aspect of these advancements: "France has always been focused on strategic autonomy, with a heavy prioritisation on the domestication of defence manufacturing expertise so as to reduce reliance on foreign suppliers."

These procurement decisions align with France's commitment to enhancing its military capabilities, as reflected in its steadily growing defence budget of $57.6bn projected for 2028.

France’s defence budget allocations reflect these priorities. The acquisitions budget, which has grown from $9.7bn in 2019 to an expected $17.4bn by 2028, represents a shift towards more investments in procurement and research and development (R&D). Acquisitions are projected to account for 30.3% of the total defence budget by 2028, up from 24.6% in 2019. This increase shows the emphasis on equipping the military with technologies and modern platforms, which industry will be hoping to capitalise on at the Eurosatory conference in Paris.  

The geopolitical landscape, notably the Russian invasion of Ukraine, has been a critical driver of France’s defence expenditure. This geopolitical shift has necessitated increased defence spending to replenish domestic stockpiles and support the Ukrainian military, reinforcing France’s strategic autonomy.

"France's approach has fallen more in line with the larger defence players like China, Russia, and the US due to the refocus on scalability of manufacturing to deliver systems at a more sustainable pace in light of growing concerns over the risk of high-intensity conflict (which would entail heavy attrition of assets),” Sauer highlighted.

France’s defence budget as a percentage of GDP is expected to rise from 1.7% in 2023 to 1.8% by 2028, still short of Nato’s 2% target. Despite this, France's per capita defence expenditure is projected to increase from $762.3 in 2023 to $832.7 in 2028, according to GlobalData research.

As France navigates this period of realignment and modernisation, the steady increase in defence spending and the focus on major procurement programmes from years gone by highlight its commitment to maintaining a technologically advanced military.

In the coming years, France will balance fiscal constraints with the imperative to enhance its defence capabilities in an increasingly uncertain global environment.

Australia could be one of the main beneficiaries of this dramatic increase in demand, where private companies and local governments alike are eager to expand the country’s nascent rare earths production. In 2021, Australia produced the fourth-most rare earths in the world. It’s total annual production of 19,958 tonnes remains significantly less than the mammoth 152,407 tonnes produced by China, but a dramatic improvement over the 1,995 tonnes produced domestically in 2011.

The dominance of China in the rare earths space has also encouraged other countries, notably the US, to look further afield for rare earth deposits to diversify their supply of the increasingly vital minerals. With the US eager to ringfence rare earth production within its allies as part of the Inflation Reduction Act, including potentially allowing the Department of Defense to invest in Australian rare earths, there could be an unexpected windfall for Australian rare earths producers.