Sunday, December 01, 2024

EU and NATO allies will support a war by 0.25% of their annual GDP?

In light of the ongoing conflict in Ukraine lands and the increasing involvement of global powers like China and North Korea, it is time for the European Union (EU) member states and North Atlantic Treaty Organization (NATO) allies to reassess their military support commitments, according to a recent EU decision.

   Estonia’s recent pledge to allocate 0.25% of its Gross Domestic Product (GDP) annually to Ukraine’s defense sets a commendable precedent. However, this level of support should not be an exception but a standard for all allies, as the EU members stated.

   Given the above, EU member states and NATO countries will link their value (added) created through the production of goods and services into their economy to advance an actual war! And we are arriving the year 2025 in less than a month!

   Historically, military spending as a percentage of GDP has been a contentious issue. During the Cold War, NATO members committed to spending at least 2% of their GDP on defense. Yet, many countries have fallen short of this target in recent years.

   The current geopolitical climate demands a renewed commitment to collective security. We must not be afraid of talking about these topics, neither leaving them on the wrong hands.

   Why should we believe that when a country contributes 0.25% of its annual GDP, it would bolster Ukraine’s defense and send a strong message of unity and resolve against aggression? Is this the proper way?

   Critics may argue that such a commitment is financially burdensome, especially for smaller economies, while others argue that the cost of inaction could be far greater.

   The economic and humanitarian impact of prolonged conflict can shadow the investment required for military support. Moreover, history has shown that collective defense efforts can deter aggression and stabilize regions, ultimately saving costs in the long run.

   But, is it about safeguarding the future of Europe and upholding the principles of collective security and mutual defense? We will solve the problem created by the wrong governments with one more weapon-oriented strategy?

Δρ. Κωνσταντίνος Μάντζαρης, Dr. Konstantinos Mantzaris, Economistmk

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