The war in Kosovo reinforced calls for greater long-term defense cooperation among European nations, including more joint procurement to speed up the modernization of the European Union’s defense capabilities. But Europe’s record on joint procurement is far from impressive. Indeed, unless governments improve the way they work together to arm themselves, they risk jeopardizing the health of an industry they are seeking to strengthen.

The difficulties surrounding joint procurement came to public attention in May 1999, when the United Kingdom withdrew from the Horizon project to build 22 next-generation frigates. Just three years after France, Italy, and the United Kingdom had agreed to build the ships, the date for getting the vessels into service had slipped by five years, while the cost had risen 20 percent over the original (undisclosed) budget.

This was no one-off. A review conducted by McKinsey of 75 major European defense programs showed that collaborative projects were more likely to encounter cost and time delays than were national projects. Cost overruns were 30 percent higher than overruns for comparable national projects, while the in-service date slipped by almost 40 percent, compared with 10 percent for national projects.

Despite these alarming figures, collaborative projects represent a...