The growth of defense spending in Europe: economic impact and new jobs

The German division of EY has presented a study assessing the economic impact of increased defense spending in Europe. Analysts have studied two scenarios: maintaining the current level of 2% of GDP or less, and increasing it to 3% of GDP. 

To strengthen independence from the United States and increase the defense capability of the EU countries, it will be necessary to invest about €65 billion annually over six years. Experts note that against the background of modern security challenges, European defense spending may exceed 3% of GDP.

According to the plans, in the coming years, European countries intend to invest 72 billion euros annually in the defense industry, which will save about 680,000 jobs. If investments increase to 3% of GDP, the volume of defense industry production will increase by €113 billion annually. This will ensure GDP growth of 0.66% per year and create an additional 660,000 jobs.