Who is re-arming in Europe? This map provides an indication as it shows the difference in defence spending between European states for the period 2021-24 (measured as a percentage of GDP).¹ While for most of the states the data shows an increase, there is sometimes no overall change (Ireland, Italy and Malta) or even a decrease, as is the case for Croatia, Cyprus, Greece and Portugal. On average and across all states shown on this map, defence spending grew by 0.4 percentage points. In absolute terms among the 27 EU member states, defence spending grew from €250 billion in 2021 to €343 billion in 2024, a 37 per cent increase.²

When it comes to an international comparison of defence spending over time, numerous caveats are in order. While using the GDP ratio allows for a cross-country comparison, it can hide certain trends. For example, states with higher economic growth will have a harder time demonstrating an increase in defence spending: between 2022 and 2024, Portugal’s economy grew 4 per cent on average annually, while Germany’s growth remained flat. This inflates German expenditure while making it harder for Lisbon to demonstrate the efforts it has made.

However, the GDP ratio does allow us to better understand the distribution of defence expenditure across Europe. It is not surprising that the states with the biggest increase are located on the Eastern Flank of the EU and NATO. The three Baltic states, close to the Russian border, have experienced an intense military build-up, often working together, as in the case of ‘anti-mobility defensive installations’, or a network of bunkers, on their borders with Russia and Belarus.

Poland, another of Russia’s neighbours, has the highest defence expenditure in the EU and NATO when measured in terms of GDP ratio.³ This did not go unnoticed by the Trump administration, which has pressured its allies to raise spending to 5% of GDP, a target that NATO leaders committed to at their June 2025 summit in The Hague. While Poland was hailed as a ‘model ally’ by the White House, it has lashed out at Denmark, historically one of the most devout of the US faithful. In spite of this – or perhaps because of it – defence has become a priority for the Danish government, which raised defence spending from approximately 1.3 per cent of GDP in 2021 to 2.4 per cent in 2024, one of the highest ratios in Europe and NATO.⁴ ,

Germany has become the new engine of EU rearmament, after Berlin launched a €500 billion defence budget. Based on current trends, by 2029 German defence spending will be approximately twice that of France, an imbalance that is mostly explained by France’s inability to substantially raise defence expenditure because of its ongoing budgetary crisis. In the UK, defence spending is also set to account for a smaller share of GDP in 2027.

Might the EU help its member states to spread the effort of rearmament more evenly? In 2024, EU defence investment exceeded the €100 billion threshold for the first time and accounted for 31 per cent of Europe’s total defence expenditure.⁵ Among the tools recently set up, the Security Action for Europe (SAFE) instrument provides cheap and long-maturity loans for member states. Central Eastern European states have benefited most from it, with Poland claiming the lion’s share. In addition, member states from the Eastern Flank are also at the centre of the newly launched EastInvest initiative. Led by the European Investment Bank (EIB), its ambition is to channel even more funding towards the defence sector, including from private investors.

In addition to this asymmetry in spending, there is the question of procurement. American defence companies continue to be the main suppliers for the European military. Again, EU initiatives could help boost domestic production since, for example, money from SAFE comes with conditions concerning procurement from European manufacturers. Ultimately, although the main SAFE recipients are in Eastern Europe, most of this investment will flow back to Western Europe, where the majority of defence suppliers are located. For example, German defence giant Rheinmetall will open a gunpowder production facility in Romania, another EU member state that has significantly raised its spending in the face of the Russian threat.

For the next Multiannual Financial Framework, set to start in 2028, the challenge for the EU will be to build on these recent experiences. As Vestert Borger argues in his Report for BIG, it will not only have to devote more money to defence but also use its budgetary powers with greater flexibility and strategic foresight. Only then will the EU acquire the financial capacity to act that it needs in this era of great power rivalry.