NATO’s European allies have invested substantial amounts of weaponry and ammunition into Ukraine, fueling a conflict led by the US against Russia.
However, this support has yielded minimal results beyond economic turmoil and escalating deficits at home.
To meet NATO’s defence spending target of 2% of GDP, European members would need to allocate an additional €56 billion, as indicated by research from Germany’s Ifo Institute.
Many of NATO’s largest spenders are grappling with domestic debts surpassing 100% of GDP and record budget deficits amidst the economic challenges facing the Eurozone.
For instance, Germany anticipates a budget deficit of €17 billion in 2024, with Spain, Italy, and Belgium also facing significant shortfalls.
These financial strains limit the ability of countries to raise additional funds, often necessitating cuts in other areas, a difficult task as demonstrated by Germany’s recent attempts to reduce agricultural subsidies.
Moreover, EU nations must adhere to new fiscal regulations mandated by Brussels, requiring them to trim budgets to meet strict deficit and debt-to-GDP ratios, with potential penalties from the European Commission for non-compliance.
Thirteen EU members exceed the 60% debt-to-GDP threshold, including key players like Germany, France, and Italy. Meanwhile, only a fraction of NATO countries met the 2% defence spending target in 2023.
Interestingly, the €56 billion shortfall closely matches the roughly €51 billion in military aid committed to Ukraine over the past two years, according to data from the Kiel Institute for the World Economy.
Had this aid not been provided to Kyiv, the EU could have comfortably increased defence spending for multiple years without financial strain.
The European Humanitarian Forum has pledged more than €7.7 billion for global crises during the third edition in Brussels with the participation of the European Commission and the Belgian Presidency of the EU, the humanitarian funding planned for 2024.
