European Defense Spending Assessment

The war in Ukraine that began in February 2022 shifted the European defense ecosystem and market by increasing spending and contract awards. Military modernization is now a spending priority for most European countries to defend against current threats.

Joint frameworks, such as the North Atlantic Treaty Organization (NATO) and the European Union (EU), encourage European countries to invest in collective defense initiatives, as well as in research and development (R&D). In this sense, the European Defense Fund (EDF) is the most important tool for new military technology acquisition.

Frost & Sullivan overviews European countries’ defense spending and budgets in this study, highlighting growth drivers, restraints, and opportunities. We use 2022 as the base year and 2022–2027 as the study period. The study includes all European countries but focuses on the 6 major spenders: France, the United Kingdom, Germany, Poland, Italy, and Spain.

The study also outlines the top 5 spenders’ most relevant contracts and budget items, as well as some up-and-coming companies in the industry. Among the persistent challenges facing the market are energy shortage and the consequent soaring prices that affect defense manufacturers.