Membership in NATO has often been used by some countries as a justification to cut defense spending and turn the collective security principle into a transfer of responsibilities. However, Finland, which officially joined NATO in April 2023, has taken a different approach.
The Finnish government has planned to significantly increase defense spending, aiming to allocate around €11 billion by 2032. For comparison, Finland's defense budget in 2020 was €3.5 billion. By 2024, the country had already increased defense spending to approximately €6 billion, exceeding NATO's minimum two-percent requirement by dedicating 2.41% of its GDP to defense.
Notably, 45.8% of this budget went toward purchasing weapons, far surpassing NATO’s standard of 20%. There are already commitments by Helsinki to raise the defense budget to €6.5 billion in 2025.
Interestingly, the initial stage of the defense budget expansion was financed by cutting social benefits, a move that drew considerable criticism from trade unions. Despite the backlash, the conservative government’s strategy to boost military spending was supported by opposition parties.
To put this into context, U.S. defense spending in 2024 accounted for 3.38% of GDP. For Finland, however, this investment is a natural response to its geopolitical realities, particularly the 1,272-km land border it shares with russia.
If we look at the overall graph of NATO members' defense spending in 2024, we'll find that Finland ranked seventh as a percentage of GDP. In Europe, only Latvia (2.85%), Lithuania (3.15%), Estonia (3.43%), and Poland (4.12%) allocated a larger share of GDP to defense.
Notably, Greece, which spends 3.08% of GDP on defense, is the only European NATO country with higher spending than Finland that does not share a border with russia. In Greece’s case, such an elevated military expenditure is driven by its proximity to Turkey, which allocated 2.09% of GDP to defense in 2024.
Moreover, all these countries, including Finland, have announced plans to further increase their defense budgets in 2025.
