NATO needs more European Investment

By Krišjānis Kariņš, former Prime Minister of Latvia, now Senior Advisor at KREAB Brussels

Freedom and security come at a cost. In Europe, we are accustomed to the United States as the
key NATO ally providing the bulk of our hard security. This is a combined legacy of the Second
World War and Cold War. That comes to 79 years of relying on this security arrangement – a
good three generations. During the Cold War, allies such as West Germany invested quite heavily
in their security, but after the fall of the Berlin wall in late 1989, a false belief that Russia’s threat
to Europe had ended translated into reduced military budgets throughout Europe. Finland, as a
non-aligned neighbour of Russia, was an exception to the general European shift of sharply
reducing investment in defence following the end of the Cold War.

As a continent, after 1989 Europe divested from hard defence and invested instead in social
welfare systems. Of course, we expected that if the need were ever to arise, the US would be
there for us. Even as the European Union (EU) and NATO started to accept members from the
east of Europe, country investment in the military always took second place to other pressing
development needs. Indeed, during the financial crisis of 2008/2009, many countries found ways
of saving public money by reducing military budgets even more.

This downward trend in defence spending was finally addressed back in 2006, when NATO
defence ministers meeting in Istanbul agreed that members would commit a minimum of 2% of
their GDP on defence. The idea, which is all that it ended up being at the time, was to correct
the imbalance between what the US was investing (4% of GDP) compared to other NATO
members (closer to 1%). This goal was formally adopted by NATO leaders eight years later in the
2014 Wales Summit following Russia’s illegal annexation of Crimea, and was reinforced as an
enduring commitment at the Vilnius summit in 2023. It is projected that this year, 23 out of 32
NATO members will meet this spending minimum. It took Russia’s all-out war against Ukraine
to finally convince European leaders that they had to invest in defence. Indeed, the shock of
Russia’s war also radically changed the minds of Sweden’s and Finland’s electorate and
politicians, and both are now NATO allies. For Sweden, accession to NATO marked the end of
200 years of non-alignment.

Since 2014, the US has had three presidents from both political parties: Obama (2009-2017),
Trump (2017-2021), and Biden (2021- ). All three have had a consistent message to European
allies: invest 2% of GDP in defence. The style of how each president has delivered this message
has varied, but the message has been consistent. It will surely be the message of the winner in
the upcoming US elections.

As always, the world is changing. The relative economic power of the US is declining as other
parts of the world are growing. For the US, China’s rise economically and militarily is taking up
more and more attention of their politicians. The US operates and needs to operate in both the
Atlantic and Pacific oceans, where China’s threat emerges. That is not to say that Russia is not a
threat to the US as well as Europe – it is. However, from the American perspective it is fair to ask
Europeans to invest more in their own defence. From the European perspective, it makes sense to invest more in our own defence, not in order to break away from the US, but to (finally)
become a stronger NATO partner.

Russia’s war of aggression in Ukraine is well into its third year and no end is yet in sight.
Ukraine clearly has the will and ability to fight back, but is dependent on western support to be
able to do so. For more than 20 years, Putin has done his best to turn back the clock on
development, moving the goal of government from improving the well-being of society (what
democratic governments try to do) to increasing the scope of state authority, power, and
repression (the specialty of autocracies). The outward manifestation of this policy has been using
the military to try to rebuild the empire and glory lost with the end of the Cold War. We have
witnessed wars in Chechnya (1994-1996, 1999-2000), Georgia (2008), and Donbas (2014- ), which
morphed into the ongoing all-out invasion of Ukraine (2024- ). This is in addition to the illegal
annexation of Crimea from Ukraine in 2014. Outside of its immediate neighbourhood, Russia
has also stepped up brutal military activity elsewhere, such as in Syria (2015- ) and, via the
Wagner group, in the Sahel (2017- ). It is clear that Russia is literally on a warpath to increase its
territorial footprint and its “standing” in the world. That means that Russia is a direct threat to
European security and the security of the European Union. As a government that only
understands the language of power, Russia can only be stopped by what is perceived as a greater
power. Europe must become strong militarily to dissuade Moscow from attempting any further
military adventure westward.

Unlike the US, Europe (or specifically the EU) is not a federal country with a single budget and
single military. The European Council and the European Commission are the closest things to a
united “government” that we have in Europe. Our militaries are disunited, with separate budgets
and separate procurement procedures. We have a wide array of military industries in Europe,
which unfortunately often produce non-interoperable platforms and ammunition. This all must
change in order for us to preserve our freedom. NATO as an alliance provides the much-needed
coordination of basic things such as military equipment standards and common defence plans. It
is still underwritten by the sheer size of the US military. As the US internally shifts its attention
away from Europe, we must be ready and committed to pick up the slack and finally become a
strong NATO partner. Put simply, NATO needs more European investment. Committing to
investing in defence is only the beginning. It will need to be sustained in the medium to long
term (think at least 20 years) to keep Russia at bay. In addition, we will need to improve the
interoperability of our military industry, as well as allocate capital for this industry to grow.

For almost 80 years Europe has relied on the US for military security. This is not sustainable. If
we want to continue to enjoy our freedom, we have to commit to seriously invest in our own
defence in the long term. The US will remain a staunch ally and the key player in NATO. But
Europe must become a stronger NATO partner to the US. Combined, the US and Europe still
remain the dominant economic power in the world. We must ensure that we have the combined
military power to back that up. It can and must be done.