Defense Spending for Europe’s Security – How Much Is Enough?

Florian Dorn

No 66, EconPol Policy Brief from ifo Institute - Leibniz Institute for Economic Research at the University of Munich

Abstract: Key MessagesDefense spending above the NATO target of 2% of GDP would be necessary for Europe to be able to provide sufficient security and to defend itself without the protective umbrella of the US.European countries must increase their efforts to catch up with an adequate defense capability, as defense budgets andmilitary investments have been too low for years.Many European countries must compensate for higher real military costs – including wages for soldiers and costs formilitary equipment – than, for example, in Russia or China.More efficient and integrated military structures need to be established in Europe in the long term. The currentgeopolitical situation immediately requires higher defense spending.European governments need a credible plan to sustainably increase defense capabilities without jeopardizing budgetarystability and economic competitiveness.

Date: 2024
New Economics Papers: this item is included in nep-cis and nep-eec
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