Here is the study (available in English and German).
Increased defense spending could significantly boost Europe’s economic growth and industrial base if outlays are targeted at high-tech, regionally made armaments. A new Kiel Report by the Kiel Institute shows that gross domestic product (GDP) could increase by 0.9 percent to 1.5 percent per year if governments raised annual defense spending from the NATO target of 2 percent to 3.5 percent of GDP and shifted from buying weapons designed and mainly made in the USA to home-grown innovations.
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The debate about Europe’s ability to defend itself took on new urgency after Russia launched its full-scale war against Ukraine in 2022. Many countries increased military budgets, with EU spending falling just short of NATO’s target of 2 percent of GDP in 2024. But NATO Secretary General Mark Rutte has noted that Europe spent ”well over 3 percent” during the Cold War—and US President Donald Trump has even proposed a new target of 5 percent.
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Most importantly, European governments should ensure that more defense spending ultimately stays within the region. Around 80 percent of defense procurement currently comes from suppliers outside the European Union. But only domestic production can generate the so-called technological spillovers to other industries and productivity gains that make defense spending generate significant economic activity with each euro spent.
”If Europe could develop the next generation of defense tech and other weapons at home instead of buying them from the US, the economic effects of additional defense spending could go far beyond short-term fiscal multiplier effects and boost growth in the medium term,” says Moritz Schularick, President of the Kiel Institute. ”An increase in European defense spending from just under 2 percent of GDP to 3.5 percent would currently cost around 300 euros billion per year—but the study suggests this sum could also generate a similar amount of additional economic activity, if properly spent on developing European capabilities.”
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In other news, water is wet
Buying US Weapons that need for every use a Start Code from the US is completely stupid given how unreliable and untrustworthy they have become
It has been stupid even before they became as untrustworthy as they are now. Also the writing of the US becoming like they are now has been on the wall for a long time. Even someone living under a rock should have waken up at very latest by that orange muppet taking the White House for the first time 8 years ago.
Even someone living under a rock should have waken up at very latest by that orange muppet taking the White House for the first time 8 years ago.
But but but it was sooo cozy in bed!!
No shit Sherlock.
However, it requires general of every country to avoid coming with their own exotic requirement, see the A400M or the Eurofighter and now the next-gen-fighter jet where French and German keep playing against each other to lead the program
I fully agree. I think this should be an EU policy.
Building a strong European defense industry must be a priority for the whole Union.
I’d like to be a consultant who’s paid significant amounts of money to tell people obvious things.
If thats what you want, then go live your dream. I’ve met consultants that transferred from entirely different professions at a rather late stage in their working lives. When that starts to pay well might be a different question…
duh
