European armaments between ambitions and mysterious financing

Amid the increasing calls to strengthen the defense capabilities of Europe, questions arise about how European countries can confront Russia in the event of a future war, without relying on American support.

Although the idea of ​​creating a “re -armament bank” seems promising, the ambiguity is still surrounding whether there are real new funds for this ambitious and costly project.

In this context, the European Commission, led by Ursula von der Line, recently revealed a huge armament plan of $ 876 billion, and the plan depends mainly on a significant increase in military spending by the 27 European Union countries, equivalent to an additional 1.5% of the gross domestic product of each country compared to the current levels.

However, the implementation of this increase faces major political and economic challenges, given the high public debts in a number of countries. For example, France needs to pump approximately 47 billion dollars annually in the defense sector, although its debts exceed 113% of its local product.

As for Italy, the third most powerful defensive force in the federation, it will have to increase its spending by about 34.7 billion dollars annually, while its year is 136% of the GDP.

New methods

In light of these data, European countries seek to invent new methods of financing arms, including the establishment of the “Defense, Security and Flexibility Bank”, which aims to attract special investments to support the development of defense industries.

The attractiveness of this idea lies in the ability to provide investment financing for purchases and new defense projects, at a time when NATO (NATO) spends more than $ 472 billion annually on equipment only, including 113.4 billion from European Union countries, with expectations of this number to rise to 195.1 billion dollars in the event that the re -arms plan is implemented.

Nevertheless, the effectiveness of this bank remains doubt, as European governments seek to transfer the burden of costs and risks to defense companies, while reducing pressure on their budgets. But at best, this system may contribute to controlling costs instead of actually reducing them or enhancing defensive capabilities, as the European Union also struggles to provide an accurate account of its annual expenses that exceed $ 800 billion.

Challenges

The situation in the United Kingdom reflects the challenges facing defense projects in Europe, where the National Audit Bureau revealed in December 2023 that the Ministry of Defense’s plan for a future contract is suffering from a deficit that is the largest since 2012. It is worth noting here that this plan was placed two years before the start of the Ukraine war.

The costs of the equipment program, according to the plan, increased by 27%, or 83.8 billion dollars in the period between 2022 and 2023, and this was done based on the spending scenario, most likely.

In the “worst case”, the total amount of costs will reach about 102 billion dollars, and if we add other expected excesses in the costs, which the British Ministry of Defense confirms the possibility of covering it through efficiency savings, the cost will rise to more than 133 billion dollars.

A busy record of failure

In March 2024, the British Parliament confirmed that the Ministry of Defense failed to manage costs and time tables for more than 1,800 projects.

The British Ministry of Defense is filled with a failure record, whether by excess spending, which was estimated at 550 million dollars on the armored vehicle “Warri” program, or a exception of $ 3.2 billion in the new aircraft carriers program, or delaying 59% in the delivery of a “Challenger 3” tank.

So far, the greatest pressure on the British budget comes from the nuclear program, which accounts for about 62% of the defense spending.

There is a joint program between the United Kingdom and the United States to create a new generation of submarines to face China’s threats in the “Ocos” program, which is benefiting from Australia, the United Kingdom and America, although the current generation of the fleet of the British “Estiot” submarine has not entered the service until 10 years ago.

Britain also has a program to design new nuclear warheads, in cooperation with the United States, at a time when the Deridnot submarine submarine that will replace the SSPNS submarines that carry nuclear missiles is currently seven years later than its specified date.

Reducing salaries

Despite these huge investments, the necessary funds that must be paid to soldiers, sailors, and air force workers have shrunk, given the increasing costs of equipment, and the defense capabilities do not seem to have improved concretely, at a time when the budget for soldiers and air force workers suffers from a continuous decrease, reaching 10% since 2010.

The salary budget was also reduced in 2024-2025 by 3.2 billion dollars, which increases the suffering of the military, who face problems in housing and increasing stress due to the large number of periods of deployment.

The biggest challenge

The biggest challenge remains the clear disparity between the size of the armies of Europe compared to Russia, and sometimes even Ukraine. It is unclear whether the European plan to arm the continent will actually succeed in building larger and more efficient armies, especially in light of the political resistance to increase military spending.

To date, Britain and Poland are the most enthusiastic to establish the armament bank, partially, because the United Kingdom is excluded from the European defense loan program that aims to provide $ 150 billion over a period of four years to support weapons purchases, especially for Ukraine.

Although the bank is supposed to be directed to develop defense industries with commercial revenues, while the loan program aims to have urgent support for providing weapons, the two initiatives may eventually appear non -sufficient, as it is still surrounded by a wide European frequency regarding the allocation of huge sums of defense.

Ian Braood*

* Researcher and economic advisor at the British embassy in Moscow between 2014 and 2019.

About «Reesbonspal Stetkraft»

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“Fake money”

A European frequency prevails over the spending of additional additional amounts to the defense, even at a time when the United States is seeking to reduce its participation.

And if the trade war led by US President, Donald Trump, evolves to a global economic dedication, all of these plans may become merely “fake money” revolving in the orbit of the European Defense Monopher Council.

. European countries seek to invent new methods of financing arms, including establishing a bank aimed at attracting investments to support defense industries.

. It is unclear whether the European armament plan will actually succeed in building larger and more efficient armies compared to Russia.