Nato members account for over half the fastest falling defence budgets - as Russia's spending soars

Guy Bentley
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Nato members comprised more than half of the fastest shrinking defence budgets between 2012 and 2014 (Source: Getty)

Nato members comprised over half of the world's 20 fastest shrinking defence budgets between 2012 and 2014, according to research from IHS.

Out of the 20 nations exercising the most spending restraint when it came to defence, 13 were Nato members, with the Alliances' spending dropping by $93bn (£56bn) over the past two years.

In the aftermath of the financial crash of 2008 and the crisis in the Eurozone, many Nato members have needed to significantly cut previously exorbitant levels of public spending, with defence often being a politically acceptable target for reductions.

“While the budgetary challenges facing Western defence ministries have long been apparent, it is still striking to see 13 out of the 20 fastest declining defence budgets between 2012 and 2014 were NATO members,” said Fenella McGerty, senior defence budget analyst at IHS Jane’s.

By contrast, Russia doubled its defence budget between 2008 and 2014. There are no signs the Kremlin is preparing to cut back on its military spending anytime soon, with the Russian defence budget set to surpass Germany and France's budgets combined by 2016, spending $98bn in real terms. Russia overtook the UK to become the world's third highest spender on defence in 2012.

On average, the Russian military budget has ballooned 18 per cent a year in nominal terms. Furthermore, the government plans to hike spending another 36 per cent by 2016.

However, IHS points out that Russia's splurge on military hardware is not in response to the crisis in Ukraine but has been a key feature of government policy for some time.

"Russia is undertaking a decade-long modernisation drive that aims to modernise 70 per cent of its equipment by 2020," said senior defence budgets analyst at IHS Jane's Craig Caffrey.

As far as IHS is aware, Russia has not revisited its spending plans as the crisis in Ukraine has escalated. Though Nato members have been trimming their defence budgets as Russia has been ramping its up, this is not necessarily cause for alarm.

IHS observe that the Alliance spends roughly $900bn per annum, more than ten times Russia's annual spend, and this disparity is not just down to the massive US defence budget. Nato's European members alone spend quadruple what Russia does on its military.

The Nato alliance remains a formidable force containing some of the world's best equipped and trained militaries. However, the Alliance faces a series of challenges as it prepares to meet in Cardiff.

Managing director of IHS Jane's, Tate Nurkin commented: “From Kyiv to Kirkuk to Kabul and beyond, long-held assumptions buttressing Western-led global security frameworks are being tested and exposed in stark and destabilizing ways. In order to stay relevant in today's anxious age, NATO will have to re-evaluate its mission, role, structure, capabilities and membership of its allies.”

On Sunday, senior US senators made their frustration with the west's response to Russia known. Republican senator and former presidential candidate John McCain told CBS' Face the Nation that the US should provide arms to Ukraine to defend its territory.

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