The state budget for next year must increase defense funding to 5% of GDP, stated the Latvian Chamber of Commerce and Industry (LCCI).
The LCCI notes that, given the rising tensions at Latvia’s border, the government has a duty to act decisively. It must make concrete decisions already during the current budget planning process that would allow for 850 million euros in savings—funds that should be redirected to strengthen Latvia’s security by raising the defense budget to 5% of GDP.
The organization also emphasizes that there is no need to increase taxes or burden businesses and society; instead, the 850 million euros could be saved by returning to the level of public expenditure seen in 2022.
“In such a complex geopolitical situation, being on the eastern border of Europe,
Latvia must demonstrate to its NATO allies the utmost seriousness and resolve in improving national defense.
Therefore, the proposed initiative to set the defense budget at 5% of GDP must be treated as a mandatory goal, with readiness to increase it even further,” said LCCI President Aigars Rostovskis.
He also stressed that without defense and security, all other issues become secondary.
The LCCI points out that increasing defense budgets is also on NATO’s agenda, with proposals to set the target at 5% of GDP.
“Latvia has no time to wait—it must be among the countries capable of showing concrete action and political will. In budget planning, this means only one thing: internal resources must be found for defense, rather than waiting for external aid,” the LCCI states.
Furthermore, the organization insists that the reduction of public spending by 850 million euros is not a matter of choice—it is an urgent prerequisite for ensuring Latvia’s security and meeting international commitments.
“Latvia lies on the European Union’s external border—we must not be the weak link,”
the LCCI adds.
Prime Minister Evika Siliņa (JV) announced in mid-June that Latvia’s defense spending could reach 4.35% of GDP in 2026.
The LCCI unites nearly 6,000 members—micro, small, medium, and large businesses from all Latvian regions and sectors, as well as associations, city business clubs, and other entrepreneurial organizations.
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