The Wales Pledge Revisited: A Preliminary Analysis of 2015 Budget Decisions in NATO Member States

Despite concerns over Russian aggression in Ukraine and political commitments made at the NATO Wales Summit in September 2014, a new study by the European Leadership Network assesses the 2015 defence expenditure plans of a diverse group of 14 NATO countries and finds that many are failing to live up to the commitments made.

The ELN analysis, which excludes the United States, shows that:

+ Only one country covered (Estonia), will spend 2% of GDP on defence in 2015.
+ Six countries will cut defence expenditure in 2015. These include two of NATO Europe’s largest spenders on defence, the UK, and Germany, plus Canada, Italy, Hungary and Bulgaria.
+ France, the other member of the ‘big three’ in NATO Europe is on course for a flat defence budget in 2015 compared to 2014.
+ Poland comes close to spending 2% of GDP on defence but falls short and is the major player among a group of six countries, many of them small in defence expenditure terms, that are increasing defence expenditure in 2015 while still falling short of the 2% target. This group includes Latvia, Lithuania, Norway, the Netherlands and Romania.

The report concludes that far from being a game-changer, the budget decisions being taken amount to something that more closely resembles business as usual, especially when one considers that the countries cutting or flat-lining are the larger spenders while those increasing spending are mostly small.

The report further concludes:

+ The rhetoric coming out of the Wales Summit has had little effect on the big European defence spenders (the UK, France and Germany);
+ Behind the façade of NATO unity, real threat perceptions differ significantly among allies and this is reflected in their divergent approaches to budget decisions;
+ There is little sign of a significant shift in Europe’s long-term downward trend in defence expenditure, despite concerns over Russian behaviour and developments in the Middle East;
+ None of the NATO countries examined have the funding or the domestic support to fully modernise their militaries and comprehensively develop their individual defence capacity. More defence cooperation among allies is the only realistic way forward.

ELN: Policy Brief, February 2015: The Wales Pledge Revisited: A Preliminary Analysis of 2015 Budget Decisions in NATO Member States http://www.europeanleadershipnetwork.org/medialibrary/2015/02/20/04389e1d/ELN%20NATO%20Budgets%20Brief.pdf

ESO: Background information: NATO Summit Wales 2014 http://www.europeansources.info/record/nato-summit-wales-2014/

BBC News, 26.02.15: Nato defence spending falls despite promises to reverse cuts http://www.bbc.co.uk/news/world-31619553

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