Defense Spending Surpasses 2% NATO Requirement

Hungary is a reliable ally, fulfilling its commitments, spending more than 2% of gross domestic product (GDP) on defense, while a quarter of member states have not yet done so, stressed Minister Péter Szijjártó after the NATO Foreign Ministers’ meeting. He mentioned that over 1,000 Hungarian soldiers are serving in the Alliance’s missions, and that the country is also in second place among the member states in terms of modernizing its armed forces.

Indeed, according to military spending databases, Hungary spent 2.1% of its GDP on military spending already in 2023, exceeding NATO’s requirement. The country has maintained this level this year and is expected to maintain it next year as well, writes Magyar Nemzet.

Meanwhile, it has imported roughly EUR 1 billion worth of German arms, making it the third largest arms buyer for the German defense industry after Ukraine and Norway.

Orders for our military technology development are part of a major cooperation with, among others, the German company Rheinmetall, also opening a plant in Zalaegerszeg (western Hungary) to produce Lynx infantry fighting vehicles, and is also involved in other domestic armored vehicle development and armored vehicle construction, and has started producing helicopter parts in cooperation with Airbus.

The Ministry of Defense will have a substantial budget next year under the 2025 draft budget, with HUF 1,939.4 billion (EUR 4.6 billion) for its expenditure. However, this also includes a technical change in the budget, with expenditure previously belonging to the Defense Fund being transferred to the expenditure of the Ministry of Defense. Defense spending next year will be worth HUF 1,753 billion (EUR 4.2 billion), with the additional funds going to the ministry for military education and sport.

The largest share of the plans for next year is made up of operational and personnel expenditure linked to the Ministry of Defense and related organizations, sectoral earmarking, and grants from the body.

This totals HUF 1,752.3 billion (EUR 4.2 billion). In 2024, this item amounted to HUF 417.78 billion (EUR 1 billion), i.e. the bulk of the items under the Defense Fund have been transferred here. A total of HUF 163.5 billion (EUR 396 million) is earmarked by the government for the administration of the ministry and the operation of other organizations, and HUF 934.74 billion (EUR 2.2 billion) for the operation of the Hungarian Defense Forces. Of this, HUF 321.96 billion (EUR 779 million) is for personnel allowances and HUF 612.78 billion (EUR 1.4 billion) for other operating expenditure, such as the purchase of equipment. For investments in the Hungarian Defense Forces and other Ministry of Defense organizations, the budget allocates HUF 534.98 billion (EUR 1.3 billion).

It is also interesting to see what this means in relation to GDP compared to other member states.

According to 2024 figures, many member states are not even close to the Hungarian level in this respect. For example, Belgium (1.3%), France (2.06%), Turkey (2.09%), Italy (1.49%), Portugal (1.55%), Spain (1.28%), Slovenia (1.29%), Slovakia (2%), and Croatia (1.81%) are lagging behind Hungary in terms of defense spending.

Only a few countries in the region have overtaken Hungary in terms of defense spending as a share of GDP this year, and not by a significant margin.

For example, Germany (2.2%), the UK (2.33%), Romania (2.55%), and northern European countries such as Sweden (2.14%), Denmark (2.37%), Finland (2.41%), and Estonia (3.43%). In central Europe, Poland spent the most on military expenditure, 4.12% of its GDP.

Via Magyar Nemzet; Featured image via Honvedelem.hu