Latvian defense spending hits 2.25% of GDP

The passing of Latvia's 2023 budget on Thursday, March 9, ensures that Latvia will spend an amount equivalent to 2.25% of GDP on defense in 2023, with that figure set to rise to 2.4% in 2024 and 2.5% in 2025 as part of a longer budgetary framework included with the legislation.

The Ministry of Defense said 163.55 million euros more will be spent in 2023 than in 2022.

It is also planned that the budget of the defense sector will be gradually increased every year - in 2024 it will reach 2.4% of the country's gross domestic product, while in 2025 - 2.5%.

The main budget priorities of the Ministry of Defense in 2023 for strengthening national defense capabilities are the improvement of the combat capabilities of the National Armed Forces by developing medium-range air defense, the acquisition of coastal defense and long-range missile artillery systems, as well as the reintroduction of compulsory military service.

In all 370 million euros will go towards personnel expenses and 309.21 million euros to maintenance expenses. 303.62 million euros are for investment - capacity and infrastructure development - expenses. From 2023 to 2025, an additional 200 million euros will be invested annually in strengthening the air defense capabilities of the National Armed Forces.

Also, the "promotion of patriotic education among Latvian youth" will be continued, as well as the strengthening of cyber security, by diverting budget funds worth 22.62 million euros. 

NATO members' defense spending trends
NATO members' defense spending trends

The figure of 2.25% of GDP continues Latvia's rapid about-face on defense spending. As recently as 2014, Latvia spent less than 1% of GDP on defense. However, events in Ukraine allied with a more demanding attitude from the NATO allies who provide considerable sums of troops and equipment to help protect the country have seen steady increases over the last decade so that now Latvia – and the other Baltic states – are among NATO's biggest spenders as a percentage of GDP.

The Ministry of Defense prepared a Latvian-language infographic outlining the spending plans (below).

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