Defence: an ecosystem in motion

On Tuesday, 9 December, some 400 people attended the second edition of the Luxembourg Defence Technology and Innovation Day, co-organised by Luxinnovation and the Luxembourg Directorate of Defence, with the valuable support of SES, Ceratizit and Euro-Composites. An event that now has its place in a rapidly developing defence technology landscape in Luxembourg.

One figure perfectly illustrates this growth: in 2022, the very first edition of the "Luxembourg Industry and Research Capabilities for Security & Defence" catalogue included only around forty companies and organisations. The last edition, presented last June at the International Paris Air Show, had 109 of them.

"We want to transform security needs into sustainable industrial opportunities that create jobs, innovation, and value for our country. Mario Grotz, CEO of Luxinnovation

"This growth reflects the dynamism of the sector and its growing visibility among economic players," said Mario Grotz, CEO of Luxinnovation, at the opening of this Luxembourg Defence Technology and Innovation Day. "Our initiatives are based on strong ethical and legal frameworks, aimed at transforming security needs into sustainable industrial opportunities that create jobs, innovation, and value for our country."

In recent years, in a very tense and changing geopolitical context, the public authorities have supported active growth in R&D efforts in the field of security and defence, whether in the national, European, or NATO framework. "Events like today's are of paramount importance to strengthen the interaction between the private and public sectors," insisted Defence Minister Yuriko Backes. "They allow for an exchange of information between experts on both sides, the government, its armed forces, and commercial enterprises. This is crucial for us to be aware of our common needs."

Strengthen interaction between the private and public sectors. Yuriko Backes, Minister of Defence.

The richness and variety of know-how and skills exhibited by some fifty companies, but also the high level of the presentations and panels, perfectly illustrates the wide range of concerns and needs of companies and institutions involved in this economic segment: the use of advanced and sustainable materials, the challenges of autonomous systems and artificial intelligence, cybersecurity, or national and European financing instruments including The actors concerned can benefit.

Yuriko BackesA new European competitiveness fund

On this last point, there is no shortage of national and European support, particularly at the international level. "There is a great desire on the part of the European Union to continue to invest in defence and to adapt to the current pace of innovation, with new programmes that are under consideration or are about to be launched," says Rebecca Damotte, Defence Innovation & Technology Advisor at Luxinnovation. "There is an awareness of certain current shortcomings, particularly in the financial support of scaleups and the marketing of new technologies."

It is with this in mind that the European Commission has launched the idea of the European Competitiveness Fund, which plans to devote €131 billion to the defence/security component from 2028 onwards. This new financial support is a continuation of what currently exists and will consolidate all the other mechanisms – in particular the European Defence Fund – currently in place. The aim is not only to make processes simpler and more efficient but also to be able to monitor and support companies throughout their journey, from the first idea to market development. "There is a real desire to work on the long term," notes Ms Damotte.

There is an awareness of certain current shortcomings, particularly in the financial support of scaleups and the marketing of new technologies. Rebecca Damotte, Luxinnovation

The NATO Innovation Fund, for its part, will continue its action, coupled with that of the DIANA accelerator.

Returning to a local supply chain

The "sustainable" dimension was also widely discussed throughout the day. With a consensus widely met by the companies surveyed: it is of primary importance to develop a local and resilient material supply chain. "We must clearly detach ourselves from the dependence of countries outside the European Union," notes Caroline Muller, Business Relationship Manager - Defence at Luxinnovation. “Hence the interest in developing circularity and recycling chains for certain materials.”

We must clearly detach ourselves from the dependence of countries outside the European Union. Caroline Muller, Luxinnovation

Because even if the environmental impact is not always a priority for contractors in the field of security and defence, there is still a real desire on the part of companies to be more virtuous and to contribute to the preservation of local resources and the local industrial ecosystem. "Of course, we can't ask the big manufacturers to change all their processes overnight, but there is clearly an awareness on the part of the new generations of companies looking for technologies and materials that allow recycling and integration into a circular economy."

Rebecca Damotte and Caroline MullerA full agenda in 2026

Several events are already on the agenda of the Luxembourg security and defence community, ahead of the 3rd edition of the Luxembourg Defence Technology and Innovation Day, which is expected at the end of the year. Thus, from 23 February, an information day dedicated to the latest calls for proposals from the European Defence Fund will be organised by Luxinnovation, around the main priorities aligned with European strategic needs: cybersecurity, space, energy resilience, land technologies, military health, and interoperability.

Then the 2026 edition of Eurosatory, the world's leading trade fair for Defence and Security, bringing together the key players in the international ecosystem, will be held from 15 to 19 June in Paris Nord Villepinte. This autumn will then mark the launch of the fourth joint call for research and development (R&D) projects to encourage innovation and skills in defence technologies. An initiative resulting from cooperation at the national level between the Directorate of Defence, the Ministry of the Economy, the Ministry of Research and Higher Education, in collaboration with the National Research Fund (FNR) and Luxinnovation.

The budget allocated to the first call in 2022 was €9.5 million over three years. Many projects related to materials had been selected. In 2024, the second call had seen its budget increased to €13.8 million with more diversified research areas. Finally, this year, this call officially became annual, with dedicated budgets increasing from more than €11 million in 2025 to more than €15 million in 2027.