NATO countries must return to Cold War-era defence budgets and increase military spending to fend off Russia, NATO Secretary General Mark Rutte said on Thursday, the 12th of December, making his first public appearance in Brussels since taking over as head of the defence alliance, while underlining new plans to set a new spending target of 3% of GDP by 2030, reports Reuters.
The Alliance’s current pledge, which only eight member states have failed to meet, is to spend at least 2% of GDP on defence.
“We are not ready for what lies ahead in four five years,”
NATO chief Mark Rutte said, adding: “It is time to shift to a wartime mindset and to increase our defence production and defence spending.”
The cash boost is needed to revive a “hollowed out” defence industry, which is being forced to increase production to respond to the Russian military threat.
“It is true that we are spending more on defence now than we did a decade ago,” Rutte said. “But we are still spending far less than during the Cold War. Even though the threat to our freedom and security is just as great, if not greater.”
“During the Cold War, Europeans spent much more than 3% of their GDP on defence,” said the former Dutch Prime Minister. In the early 1980s, before the collapse of the Soviet Union, NATO members in Europe spent on average around 3.8% of GDP on defence.
In a question-and-answer session after his speech, Rutte refused to name a specific target for new defence spending, saying only that “considerably more than 2%” was needed.
Russia’s soaring defence spending shows that the Kremlin is preparing for a long-term conflict with both Ukraine and other European countries, Rutte said, citing figures showing that Moscow’s military spending accounts for more than a third of the country’s budget, or more than 6% of GDP.
There is a growing consensus among allies that the current 2% target is insufficient to implement regional defence plans and meet NATO’s capability targets,
which are due to be updated next year with more stringent requirements.
The European Commission estimates that EU defence spending needs to increase by 500 billion euros over the next decade. Defence Commissioner Andrius Kubilius has said that the next EU budget should increase defence spending to 100 billion euro from the current ten billion and exclude military spending from public debt and deficit limits.
Defence funding will be a priority during Poland’s upcoming EU Council Presidency.
Andrzej Jan Domański, Polish Finance Minister, outlined two options for joint EU financing: a common EU debt issue, requiring unanimous consent, or a special-purpose body to which national contributions would be made on a voluntary basis. However, given the opposition of frugal countries such as Germany, it is unlikely that any substantial proposals will be tabled before February, when German elections are due, he said.
Rutte favours involving banks and pension funds in defence investments and revising outdated military procurement rules to streamline contracts.
He urged governments to “give our industry the large orders and long-term contracts it needs” to boost production and capabilities.
He also had a message for arms manufacturers: “Dare to innovate and take risks! … Add extra shifts and new production lines!”
The aim is to rearm countries that allowed their military structures to atrophy after the end of the Cold War.