062 PCTR 12 E - BUDGET CONSTRAINTS: A CHALLENGE TO ALLIANCE COHESION?

The report looks at the general defence spending trends in NATO member countries within a broader international context, including the increased military spending of emerging powers.  The continuing financial and economic crisis continues to put considerable strain on Allied defence budgets, making the necessary transformation of the armed forces of NATO member states difficult.  The situation is particularly challenging for European Allies, most of which have underinvested in military equipment over the years. 

The rapporteur suggests that declining defence budgets are likely to limit NATO’s military capabilities and its ability to respond to emerging security challenges and further deepen the already huge gap between the US and its Allies.  These developments could lead to a weakening of cohesion among NATO member states, as they reopen the question of fair burden sharing among Allies.  The rapporteur welcomes NATO’s “Smart Defence” concept as timely but cautions that it remains to be seen if it will significantly improve defence cooperation among Allies.

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