Germany became Europe’s biggest defence spender for the first time since the end of the Cold War last year after spending billions on procurement, the Stockholm International Peace Research Institute (SIPRI) said on Monday.
The researcher’s annual report on national military expenditure says that Germany’s military spend hit €77.8 billion ($88.5 billion) last year, beating the UK which spent an equivalent $81.8 billion. That makes Germany the biggest spender in Europe in real terms and the fourth largest in the world after the US, China and Russia.
The boom was thanks to a €100 billion off-budget fund set up to modernise the national army following Russia’s war on Ukraine, said Lorenzo Scarazzato, a researcher at SIPRI who helped compile the numbers.
Europe’s other biggest spenders in 2024 were the UK, at €71.9 billion ($81.8 billion), followed by Ukraine and France, both at €56.9 billion ($64.7 billion).
Every European country but Malta – a neutral state – increased its military spending, pushing totals beyond Cold War-era highs, the report reads. The biggest year-on-year jumps included Romania (43%), the Netherlands (35%), Sweden (34%), and the Czech Republic (32%).
“The latest policies adopted in Germany and many other European countries suggest that Europe has entered a period of high and increasing military spending that is likely to continue for the foreseeable future,” said Scarazzato.
However big, the numbers hide just how much some key European countries still have to do to exceed, or even just meet, NATO’s 2% of GDP defence spending target.
While US president Donald Trump is pushing for an increase to 5% of GDP, leaders are expected to agree on a number in a highly anticipated June summit in The Hague this June. Diplomats expect that a compromise could be struck between 3% and 3.5%.
For comparison, the SIPRI data shows that American spending was up to €876.5 billion ($997 billion) in 2024. That’s 66% of all spending by NATO’s 32 member countries and 37% of the entire global military spending in 2024.
Poland is the runaway leader in Europe, having spent 31% more on defence last year compared to 2023, reaching €33.4 billion ($38.0 billion) in 2024, according to SIPRI. NATO reports that Warsaw allocated an estimated 4.07% of its GDP to defence in 2024, based on 2021 prices and exchange rates.
The gap is so big for some countries, however, that despite a 28% year-on-year spending jump, Germany only hit 2.1% of GDP in 2024, figures published by the Western military alliance last Thursday showed.
The Bundestag has passed a constitutional reform that will exempt military spending that exceeds 1% of GDP from its rules limiting borrowing under the so-called ‘debt brake’ mechanism which limits borrowing.
However, no concrete plan on how this newly available debt could be used by the German government has yet been put forward.
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