Record high European defence spending boosted by procurement of new equipment

Source: European Defence Agency (EDA)

The European Defence Agency (EDA) has published its annual Defence Data report for 2022, for the first-time detailing defence spending from all EU Member States. At a record €240 billion, 2022 European defence spending again increased by 6% on the previous year, marking the eighth year of consecutive growth. 20 of the 27 EU Member States increased defence expenditure, with six increasing spending by over 10%.

 

2022 European Defence Spending – Key Findings

• Sweden (+30.1%), Luxembourg (+27.9%), Lithuania (27.6%), Spain (19.3%), Belgium (14.8%) and Greece (13.3%) recorded the highest increases in overall expenditure among the EU 27.

• A record €58 billion was allocated to defence investments; overwhelmingly towards the procurement of new equipment, which increased by 7% on the previous year.

• Significant jump in value of projects managed by EDA; with 18 projects starting in 2022 worth more than € 76 million, for a combined value of € 250 million across 46 projects managed on behalf of Member States by EDA.

 

 

High Representative/Vice-President and Head of the European Defence Agency Josep Borrell said: “Our armed forces must be ready for a much more demanding era. Adjusting to these new realities first and foremost means investing more on defence. A record €240 billion underpins the commitment of Member States to bolster European defence. However, we have key capability gaps and continue to lag behind other global players in spending. This is why it’s not just about spending more in defence, but also about spending better and together. We must find extra value in our ability to cooperate and seize the opportunities to strengthen our armed forces through common planning, shared projects and joint procurements.”

 

Commitment to investment 

The allocation of €58 billion of total defence expenditure to defence investment by the 27 EU Member States marks a robust growth of 5.9%. The agreed benchmark of 20% total expenditure to this area is surpassed for the fourth year with a 24.2% total across the EU. 20 Member States reached this collectively agreed benchmark, with Luxembourg (53.5%), Hungary (48.1%), Greece (42.6%), Finland (37.4%) and Lithuania (34.8%) with the highest allocation of their overall defence expenditure to investment.

 

 

Research spending slips  

Despite record overall spending, expenditure dedicated to defence research and technology (R&T) is down, €200 million compared to the previous year. Only two MS meet the agreed 2% benchmark of defence expenditure dedicated to R&T activities, together accounting for more than 80% of all defence R&T expenditure. EU collaborative endeavours such as the EDA Ad Hoc framework and funding via the European Defence Fund can collectively bring the EU closer to achieving the benchmark for defence spending allocated to R&T activities.

 

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