European Defence Spending: Turning a Corner?

NATO Secretary General Jens Stoltenberg issued his Annual Report this week, including the most recent figures for the Allies’ defence expenditure.

Although in 2016 only four European Allies (Greece, Estonia, Poland, UK) met the agreed target of spending 2% of GDP on defence, the overall picture of Europe’s defence spending is more encouraging. In real terms (constant 2010 prices and exchange rates), all but four of the European Allies increased their defence expenditures between 2015 and 2016. Latvia and Lithuania have increased their defence spending by an extraordinary 42% and 34% respectively, while Hungary, Italy and Slovenia have also seen percentage increases in the double digits. Poland, one of the four European Allies to have reduced their defence spending in 2016, has done so only after several years of sustained year-on-year growth. Overall, NATO Europe’s defence spending has increased by 3.6%.