Trump effect? Europe's defense spending to rise faster in 2017

BRUSSELS (Reuters) - Europe and Canada will raise defense spending at the fastest pace for three years in 2017, NATO Secretary-General Jens Stoltenberg said on Wednesday, partly aimed at showing the United States they are committed to shouldering more costs.

NATO Secretary-General Jens Stoltenberg addresses a news conference ahead of a NATO defence ministers meeting at the Alliance headquarters in Brussels, Belgium, June 28, 2017. REUTERS/Francois Lenoir

U.S. President Donald Trump has made more expenditure his priority for NATO, using his first alliance meeting in May to scold European leaders about spending, which is at historical lows and does not meet NATO’s target of 2 percent of GDP.

This year’s 4.3 percent increase represents the fastest growth since more than a decade of cuts ended in 2014. Spending growth was 1.8 pct in 2015 and 3.3 percent last year, although it was unclear how near that takes members to the target.

Stoltenberg said the higher spending by Europe and Canada, some $280 billion this year, was NATO’s way of showing Washington that the United States had reliable allies, after Trump repeatedly questioned the alliance’s worth and only this month publicly committed to its mutual defense pledge.

“For me, America First is not America alone,” Stoltenberg told reporters, referring to the new administration’s foreign policy focused on U.S. interests and U.S. national security.

“No other great power has that, China, Russia do not have anything like the U.S. has in NATO, 28 allies that stand together with the United States, which provide support.”

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Figures for individual allies will be released on Thursday, after approval by the North Atlantic Treaty Organization’s envoys, but overall 2017 spending will add to a cumulative $46 billion jump since cuts left Europe without vital capabilities, such as refueling airborne fighter bombers.

NATO officials stressed that while Trump’s tough stance had put the spotlight on defense spending, Russia’s annexation of Ukraine’s Crimean peninsula in 2014 had a bigger impact.

After that annexation, allies agreed to spend 2 percent of economic output on defense every year by 2024 and reverse a trend that saw military research spending in the European Union fall by more than 20 billion euros ($23 billion) since 2006.

But only four of NATO’s 27 European members - Greece, Britain, Poland and Estonia - met the spending target in 2016. Romania will also do so this year, followed by Latvia and Lithuania in 2018, Stoltenberg said.

Twenty five of NATO’s 29 allies plan to lift spending this year, he said, a day before NATO defense ministers meet in Brussels to discuss greater security spending on rising threats including deterring a resurgent Russia, dealing with failed states on its borders and protecting against cyber attacks.

For the first time, NATO governments will produce national plans this year showing how they will reach the 2024 spending pledge, focusing not just on spending increases but also monitoring troop contributions to missions and acquiring technology such as precision-guided munitions.

The new figures are part of a broader rise in military spending in Europe, as the United States commits billions more dollars to return troops and heavy weaponry to the continent to deter Russia, and as the European Union seeks to set up a multi-billion-euro defense fund.

“We have really shifted gears, the trend is up and we intend to keep it up,” Stoltenberg said.

He said the increase in funds would be spent on more military exercises, training and equipment and to allowing NATO troops to deploy at ever faster notice, as well to pay salaries and pensions.

“It’s more about high-end forces, heavier forces and more ready forces, meaning we need forces that are fully equipped, fully manned and fully trained,” Stoltenberg said.

Editing by Louise Ireland