NATO member state boosts defence budget to counter growing threats

Proceeding from a latest article, Fortune unveils that Denmark is set to ramp up its defence budget in a bold move to strengthen its military amidst rising geopolitical tensions. 

Denmark has announced plans to significantly increase its defence spending by 70 per cent over the next two years, pushing its defence budget to 3.2 per cent of GDP. This move comes as a response to US President Donald Trump's calls for NATO members to enhance their military capabilities and a recent Danish intelligence report warning of the potential for war in Europe within the next few years, particularly involving Russia.

As NATO member Denmark works to strengthen its military in light of shifting geopolitical dynamics, including concerns about reduced US support for the transatlantic alliance and ongoing Russian aggression, the country will allocate an additional $7 billion to its defence budget. This increase will raise Denmark's defence spending from 2.4 per cent of GDP in the previous year.

Danish Prime Minister Mette Frederiksen underscored the urgency of the country’s defense procurement strategy, which will be supported by a restructuring of the defense ministry and waivers to speed up the process.

“There is one message for the chief of defense: Buy, buy, buy,” Frederiksen told reporters. “If we can’t get the best equipment, buy the next best. There’s only one thing that counts now and that is speed.”

The additional funding will enable Denmark to acquire advanced weaponry and provide further military support to Ukraine. This decision follows Denmark’s recent $1.9 billion commitment to bolster Greenland’s defenses, amid growing Russian military activity in the Arctic and President Trump’s suggestion that the US should take ownership of the island.

While NATO members have agreed to aim for defence spending at 2 per cent of GDP, many countries, including Denmark, have yet to meet this target. President Trump has advocated for increasing the defence spending goal to as much as 5 per cent.

European defence companies such as BAE Systems, Thales, Leonardo, and Saab have seen significant growth since Trump’s election, surpassing major US defence contractors like Lockheed Martin and Northrop Grumman in stock performance. This shift comes as Trump pushes for Pentagon budget cuts and seeks a quick resolution to Russia’s ongoing war in Ukraine, with the possibility of European troops being deployed as part of a peace settlement.

Earlier this month, the Danish Defense Intelligence Service assessed the risks posed by Russia following the end or freezing of its war in Ukraine. According to a report, Russia could initiate a local conflict with a neighbouring country within six months, spark a regional war in the Baltics within two years, and potentially launch a large-scale assault on Europe within five years if the US does not intervene.

“Russia is likely to be more willing to use military force in a regional war against one or more European NATO countries if it perceives NATO as militarily weakened or politically divided,” the report stated. “This is particularly true if Russia assesses that the US cannot or will not support the European NATO countries in a war with Russia.”

This warning was echoed by Alexander Gabuev, director of the Carnegie Russia Eurasia Center in Berlin. In an article, Gabuev emphasised that Russia is working to rebuild its military to become stronger and more capable over the next five years.

Even if the war in Ukraine ends and sanctions on Moscow are lifted, Gabuev noted that Russian President Vladimir Putin will remain hostile toward the West, viewing it as a “mortal enemy.” He added, “Putin’s triumphalism, vengefulness and desire to make a mark on Russian history, along with the glaring lack of checks and balances in the Kremlin, will prompt Moscow to start preparing for the next war while stepping up its intimidation campaign against Europe.”

By Naila Huseynova