Worrying: Europe facing 50% hike in defense equipment prices
What's the story
European countries are witnessing a sharp rise in the cost of defense supplies, with some items seeing price hikes of over 50% in the last two years. The trend comes as NATO allies are increasing their military spending. Estonian Defense Minister Hanno Pevkur revealed this at the Lennart Meri security conference in Tallinn yesterday.
Financial impact
NATO's defense spending plans under threat
The steep rise in prices for weapons and other military equipment is making it difficult for NATO to stick to its defense spending plans. This comes as Europe is under pressure to quickly rearm and bear the bulk of costs for supplying Ukraine amid Russia's invasion, with the US shifting its focus elsewhere.
Supply dilemma
Pevkur warns of potential supply shortages
Pevkur also pointed out a 'chicken-and-egg' problem where countries are facing supply shortages in the market. Meanwhile, the European defense industry isn't willing to invest more until governments sign contracts. He stressed that Europe cannot afford to wait until 2030 to improve military readiness as Russia could pose a threat as early as this or next year.
Spending strategy
Need for Europe to act quickly
Pevkur stressed the need for sustained high spending in the defense sector. He said, "If the industry doesn't understand that there will be a lot of money on the market, then you are late."