BUSINESS

Greek military spending hits 2 pct NATO target

TAGS: Defense

Pressure from the United States on NATO allies to increase their defense spending could strain the capacity of the arms industry to keep up with demand, the head of Swedish fighter jet and submarine builder Saab said.

While many analysts believe European arms makers have plenty of spare capacity, Saab chief executive Hakan Buskhe pointed to tensions over Russia’s actions in Ukraine and said alliance members would have to respond to the US demands.

Military spending stagnated for so long after the Cold War that the budgets of many states are well below a NATO target of 2 percent of gross domestic product, putting them at odds with Washington, Buskhe noted.

According to NATO data, four out of the 28 alliance countries apart from the United States met the 2 percent threshold last year: Britain and Greece plus Eastern European members Estonia and Poland.

[Reuters]

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