Press Release

Contact: Charles Falzone III, NATO/Europe Defense Analyst

Phone: (203) 426-0800

Fax: (203) 426-4262

Web site: www.forecast1.com

E-mail: charles.falzone@forecast1.com

Forecast International, Inc.

22 Commerce Rd. Newtown, CT  06470 USA

FOR IMMEDIATE RELEASE

New Members Highlight
Restructuring Plans for NATO

NEWTOWN, Conn. [October 13, 2004] — The North Atlantic Treaty Organization (NATO) is redefining itself in ways unforeseen just a few short years ago. In its latest round of expansion in March, seven new nations – Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovenia and Slovakia – joined the defense alliance, expanding the membership to 26. In that one move, three former post-communist Eastern European states became part of a defense organization that they opposed during the Cold War. The occasion will inevitably effect an augmentation of NATO's defense spending, making the alliance more secure, and create cooperation between countries previously outside the Western sphere.

Even with the Cold War over, change has come slowly to NATO's overall structure and purpose. However, the Prague Summit in November 2002 raised several issues that deserve special attention, including NATO's place in a world no longer threatened by the Soviet Union, and the threat of international terrorism.

The relevance of large standing armies was another topic brought up for consideration. Without the threat of invasion, large armies within the NATO alliance are hardly necessary. Furthermore, much of what NATO member countries spend on defense is in personnel costs – funds that could be better used to upgrade aging technologies and on the research and development of new ones.

Many NATO countries still employ large numbers of poorly trained conscripts whose military terms last no more than a year at most and in some cases fewer than six months. Former NATO Secretary Lord Robertson considers most of these 1.4 million soldiers "useless" for the organization's current missions. "The harsh unavoidable truth is that if our governments are to continue to take on political commitments to do more militarily, in Afghanistan or in Africa or anywhere else, then they must improve the usability of their armed forces," Robertson remarked.

"Personnel issues notwithstanding, NATO planners are focusing on a restructuring plan that will work toward ensuring highly mobile ground, naval, and air forces capable of responding to a threat, and acting as part of the alliance, in any part of the world," said Charles Falzone III, Forecast International defense analyst and author of "NATO Market Overview." "Terrorism is receiving special attention, with an emphasis on the prevention, disposal, and location of weapons of mass destruction."

Defense spending is expected to rise among the newest NATO nations as they modernize their forces to increase interoperability. In some cases it may take decades to bring former Warsaw Pact nations to U.S. standards. Indeed, with the United States developing military technology at such a feverish pace, this effort at modernization may prove tentative at best.

Forecast International is a leading provider of Market Intelligence and Analyses in the areas of aerospace, defense, power systems and military electronics. Based in Newtown, CT, USA, Forecast International specializes in long-range industry forecasts and innovative marketing presentations, including regular 10-year forecasts. To arrange an interview with Forecast International's analysts, please contact Monty Nebinger (203-426-0800, monty.nebinger@forecast1.com).