Kateryna KrasinaThe article is based on the presentation of the study “Fit for War by 2030? European Rearmament Efforts vis-à-vis Russia: Rising but Lagging in Numbers and Technologies”, held on 8 October 2025 at the Vienna Institute for International Economic Studies.
Speaker – Guntram Wolff, Senior Fellow at the Brussels-based think tank Bruegel; Director of the German Council on Foreign Relations in 2022–2024, and Director of Bruegel in 2013–2022.
Key Takeaways:
- European countries are increasing defence spending and procurement, but still lag behind Russia in production volumes and delivery rates. In terms of Purchasing Power Parity (PPP), Russia is effectively the largest economy in Europe and spends roughly as much on the military as all European countries combined.
- Despite rising defence expenditures, Europe struggles to achieve genuine rearmament. The European arms market and cooperation mechanisms remain fragmented. European states prefer to buy from national manufacturers, slowing the pace of rearmament.
- To change the situation, European states must take responsibility for security on the continent. This requires: large-scale rearmament; the creation of a common European defence market; the establishment of a “European Defence Mechanism”; development of strategic enablers (e.g. satellite reconnaissance and communications); integration of defence systems (e.g. strategic air defence); and building strategic lift capacity (air and naval transport).
After Russia’s full-scale invasion of Ukraine European countries reconsidered their security policies. The concept of “strategic awakening” emerged – emphasising reliance on own capabilities and activation of defence strategies. However, despite increased military spending, Europe is still unable to match Russia’s scale of production and delivery speed.
According to the study “Fit for War by 2030?” (Kiel Institute, 2025), fragmentation of the European arms market remains a key obstacle to rapid progress. The authors estimate that to meet operational readiness goals by 2030, the EU must increase its defence production roughly fivefold.
Spending and delivery gaps remain noticeable despite Europe’s “strategic awakening”
The average defence expenditure among European NATO members has reached 2% of GDP, with some countries spending significantly more – Poland, for example, spends 4.7%. Spending on military equipment has also risen disproportionately, now averaging around 0.7% of GDP.
Russia, however, spends almost 7% of its GDP on the military. Adjusted for PPP, Russia is effectively the largest economy in Europe and spends as much on defence as all European countries combined.
Quantitative disparities are also clear. According to the Kiel Institute’s scenario based on 25 brigades, as of 2024 Russia has 1.7 times more tanks (2,730 vs 1,627) and three times more artillery systems (3,415 vs 1,115). If European production ramps up successfully by 2025, the gap is expected to narrow: about 1.5 times in tanks and 2.7 times in artillery.
At the same time, both currently and in the future, Europe surpasses Russia in IFV/IMV production: 13,042 vs 10,693 units in 2024; 17,116 vs 12,587 projected by 2030.
Fragmented market as a core problem
Despite higher defence expenditure, genuine rearmament is difficult. Production remains nationally dispersed. France and Germany prioritise domestic manufacturers, but these lack the industrial capacity to handle large orders quickly.
Insufficient intergovernmental cooperation makes supply “inelastic” – prices can rise, and some states (e.g., Poland) turn to suppliers outside Europe (such as the U.S. or South Korea), undermining efforts to build a joint European defence ecosystem.
Although the EU has several cooperation and funding tools in the defence sector (EDA, PESCO, Security Actions for Europe), they function in a fragmented manner and do not create binding mechanisms for joint procurement – which prevents full benefit from collaboration.
Steps required to achieve operational readiness
To ensure security in the region, European states must take responsibility and address core defence-related issues.
One way is to establish a common European defence market, ensuring competition among manufacturers and encouraging new entrants.
In addition, a new institution – the European Defence Mechanism – is proposed. Key principles include: openness to all European countries, including non-EU members (such as the UK); non-discrimination in defence procurement based on nationality.
These measures would expand the European market, encourage cooperation in defence projects, and balance supply and demand.
The mechanism would also include financial components: commitments to pay for armaments, including services related to strategic enablers; issuing bonds on capital markets to finance procurement; allocating voting rights to members based on their contributions.
Another essential element is the creation and maintenance of strategic enablers. Since Europe lags behind the U.S., Russia, and China in this area, the mechanism would include joint funding, development, and ownership of such capabilities (e.g., satellite reconnaissance and communications). Also crucial are integration of defence systems (such as strategic air defence) and ensuring strategic lift capacity (air and maritime transport).
Conclusions
Despite the strategic awakening, Europe remains constrained by internal fragmentation and bureaucracy. If European states aim to achieve strategic readiness, they will need to:
- expand joint arms production,
- establish more binding mechanisms of cooperation,
- and ensure substantial long-term investments in the defence sector.