Seven European nations have increased defense budgets in one month. Who will be next?

PARIS: The war in Ukraine has been a strong wake-up call for a number of European countries who’d been basking in post-Cold War comfort thinking that armed conflict was relegated to history and that spending on defense could be minimal.

The turnaround since Russia’s Feb. 24 invasion of Ukraine has been nothing less than stunning, to the point that six NATO members have now pledged defense increases of $133 billion so far; militarily neutral Sweden has also pledged an increase. And more nations seem poised to follow suit in the days and weeks to come.

The first to make a 180° turnaround was Germany. Just four days after Russia’s invasion began, Chancellor Olaf Scholz announced his government would ramp up its defense spending in 2022 alone by €100 billion ($112 billion) taking defense spending from 1.53% of GDP to above 2%.

That is the figure recommended by NATO estimated to have been only met in 2021 by the US, Greece (3.82%), Croatia (2.79%), the United Kingdom (2.29%), Estonia (2.28%), Latvia (2.27%), Poland (2.10%), Lithuania, (2.03%), Romania (2.02%) and France (2.01%), according to NATO statistics. (That Germany had not met that threshold was a major political sticking point during the Trump administration, leading to tensions between Washington and Berlin.)

RELATED: For more coverage on the Ukraine crisis, click here.

Scholz said in the wake of Russia’s invasion of Ukraine it had become clear “we need to invest significantly more in the security of our country, in order to protect our freedom and our democracy.” If the money Scholz has requested comes through, it will mark a dramatic moment for Germany, with Berlin becoming the largest overall defense spender in Europe. How that money will be spent will be important to watch for industry; currently, only four European NATO member states (Iceland, Slovenia, Portugal and Belgium) spend a lower percentage of their overall defense spending on procurement and defense-related R&D than Germany’s 18.6%.

NATO’s geographic home of Belgium followed suit days later, announcing on Feb. 25 it would raise its defense budget from the current €4.2 billion (0.9% of GDP) to €6.9 billion (1.54% of GDP) by 2030. But on March 16 Prime Minister Alexander De Croo told parliamentarians this was not enough, indicating more may come.

Romania announced on March 1 it will up its defense budget from 2.02% to 2.5% of GDP starting in 2023. The 2022 defense budget of RON25.9bn ($5.8bn) is already 14% higher than 2021. Florin Cîțu, president of the Romanian Senate, suggested a day later that a large proportion of the new funds should be used for capital investments, but gave no precise figures. A forecast released in December 2021 suggested investment would account for 40% of the total defense budget by 2025. That will likely increase further in light of the new 2.5% goal.

Poland’s deputy prime minister Jaroslaw Kaczynskihas said on March 3 that his country, which shares a border with Ukraine, will increase defense spending from 2.1% to 3% GDP. “We will table an amendment — 3% for the (defense) budget, starting next year. Then we’ll increase it further,” Kaczynski told parliament.

Italy, which currently spends just 1.41% of its GDP on defense (about €24.4 billion or $29.8 billion) followed suit on March 16 when parliament voted overwhelmingly to raise defense spending to 2% (without specifying a deadline) in order to “guarantee the country’s deterrence and capacity to protect national interests, also from the point of view of energy supplies.” Rome’s defense budget would have to rise from $29.8 billion to $41 billion to meet this 2% goal.

The latest country to announce a boost to its defense spending is Norway, which said on March 18 it would this year provide an additional NOK3 billion ($341 million) to shore up its military forces along its 120 mile land and 1,087.49 mile maritime border with Russia. “Even if a Russian attack on Norway is not likely, we must realize that we have a neighbor to the east that has become more dangerous and more unpredictable,” Norwegian defense minister Odd Roger Enoksen told media. He said “we need to increase our presence in the north,” remarking that “Russia has significant security interests in our region and the north is also of great economic importance to Russia.”

Outside of NATO, Sweden will also raise defense spending from 1.3% of GDP to 2% “as soon as is practically possible. That is, when it’s possible to translate these increases into strengthened defense capabilities,” Prime Minister Magdalena Andersson told reporters on March 10. During the Cold War Sweden used to spend 4% of its GDP on defense, and Stockholm had already begun making moves to raise defense spending.

In 2020 the 349-member Riksdag assembly had approved the largest defense hike in 70 years, agreeing that by 2025 the annual defense budget would amount to SEK89 billion ($9.5 billion). The 2021 defense budget was around SEK66 billion ($6.8 billion).

Speaking at a press conference Andersson said increasing the defense budget to 2% of GDP would require spending some SEK108 billion ($11.5 billion) every year.

“Tensions are high in our neighborhood – the situation is worse than for several decades and we need to keep strengthening our defense capabilities,” Andersson is quoted as saying on the Swedish government website. “Including the current defense resolution, expenditure on defense will have increased by 85 % between 2014 and 2025,” she added.

RELATED: Some Advice For Companies Seeking European Defense Fund Money

Swedish Armed Forces chief of operations Michael Claesson said in a later press conference that it was too early to say in what areas Sweden’s capabilities would be strengthened. “There is currently no plan for the (military) growth announced. We will need to see what this will mean in concrete terms in the near future.”

In addition Swedish parliamentarians have agreed that more young men and women will be called up to do the mandatory military service reintroduced in 2017 after a men-only draft was ended in 2010. And local media reported that Swedish Navy has asked inhabitants of the islands in the Stockholm archipelago to report any suspicious underwater activities such as submarine periscopes or suspicious wave formations.

At a NATO meeting in Brussels on March 16 Hultqvist said Sweden’s cooperation with NATO has deepened, with improved exchange of information and coordination of activities and strategic communication. “Cooperation between countries is crucial for security and stability in our neighborhood. Sweden’s strengthened partnership with NATO is incredibly important given the worsening security situation,” he said.

Potential Growth to Come

Several other nations have also indicated plans to increase defense spending, without hard details announced.

President Egils Levits of Latvia, which has a 133-mile border with Russia, said on Feb. 26 that his nation must increase spending to strengthen its defense and security system. “At the same time, we believe that internal security cannot be separated from external security. It forms a common security system. Internal security must be strengthened together with external security. Concrete decisions will be made on this issue as well,” he said.

RELATED: Russia’s invasion of Ukraine has created NATO’s watershed moment

Latvia’s defense minister, Artis Pabriks, said in a recent interview with Defence Turkey that his country’s current defense budget is just under €1bn. The small Baltic state’s armed forces are made up of five brigades, one of which is professional and four are National Guard volunteer brigades. There is also a navy and some air defense.

“If we were not now a member of NATO or the European Union, we would share the fate of Ukraine now. It would be guaranteed that Russia would invade us. Now they can’t do this because we are a member of NATO,” said Pabriks, who is notably outspoken against Russia on twitter and in public comments.

Finland, which borders Russia for 833 miles, has a 2022 defense budget of about €5.1bn ($5.66 billion), up €0.2billion ($0.22 billion) from 2021. Local media quoting government sources report that the government “will meet soon to discuss raising the budget” for the country’s defense forces for both 2023 and the long term.

The 2022 defense budget for the Netherlands is €12.4 billion ($14.26 billion), a 2.7% increase over the 2021 budget and stable at 1.43% of GDP. But on March 1 the new State Secretary of Defense Christophe van der Maat said the Dutch armed forces are no match for the Russian army, seemingly setting the stage for a budget plus-up request.

During a Feb. 28 parliamentary debate, a large majority in the Tweede Kamer, the lower house of the Dutch parliament, demanded more money go to defense in response to the Russian invasion of Ukraine. Defense Minister Kajsa Ollongren said during the debate that she will map out how to grow the defense budget to 2% of GDP. For the Dutch, that is going to be a long-term project: despite plans announced in late 2021 to invest over $11.8 billion in defense over the next four years, the country is currently on track to remain below that NATO target.

The two remaining biggest defense spenders in Europe, the UK and France, have yet to specify by how much they will hike their respective defense budgets. France is in the midst of a presidential campaign but incumbent Emmanuel Macron has said that if he wins a second term he will amplify the defense budget. Under Macron, defense spending has already risen by €1.7bn ($1.88 billion) every year since 2017 to reach €40.9 billion ($45.1 billion) this year.

Britain’s Chancellor of the Exchequer (finance minister) Rishi Sunak is to make his annual budget speech on Wednesday, but is not expected to announce any increase in the country’s defense budget after having already announced in 2020 that defense spending in 2024/25 would be around £47.4 billion ($62.5 billion), up from £47 billion for 2022/23.