You are here

Defence budget

As of 2012 the Defence budget or the Ministry of Defence’s governing minimum amount is 2% of the gross domestic product. This supports a military national defence with a balanced and sustainable development as well as meeting NATO recommended military expenditures.

  • 2% GDP supports a sustainable and balanced development of national defence

    As of 2012 there has been an agreement between the political parties of the government to support and maintain the defence budget at a 2% GDP expenditure. Military expenditures represent approximately 4.5% of the total state budget. This is one of the smallest items in the budget. This guarantees the defence expenditure to be maintained at 2% of the gross domestic product supporting a sustainable and balanced development of national defence.

  • The opportunity to support military exercises and up to date equipment for individuals

    Maintaining a defence expenditure of 2% GDP allows to keep personnel,- activities- and investments at an approximate equal level and within the defence budget.

  • Development of capabilities supports stable funding

    2% GDP allows long term and constant planning of Defence Forces development.
    New military capabilities, armaments and sustainable planning of Defence Forces development requires longer perspectives than a one year budget. The defence
    sector must be able to have long term commitments, often several year undertakings, consequently assurance of the size of the defence budget must be agreed upon. Previous investments can become senseless if programs are suddenly ended due to a reduction in resources. The 2% GDP expenditure for national defence allows for planning on a long term basis as well as efficient use of taxpayers’ money.


Estonia’s defence expenditure in 2024

The Ministry of Defence Development Plan 20242027 implements the decisions set out in the National Defence Development Plan 2022–2031.

The basis for developing independent defence capability is the development of units specified in the National Defence Development Plan into combat-ready units equipped, manned, trained and secured with supplies. The National Defence Development Plan is implemented through the development plan for the Ministry of Defence governance area, which describes the four-year development goals of military defence and links these to resources. Priorities are determined based on military advice from the Commander of the Defence Forces and proposals from the heads of government agencies, taking into account the commitments made to NATO.

Defence spending in 2024 is directly affected by the war in Ukraine.

In 2022, Estonia was one of the seven NATO members whose defence spending was at least 2% of the GDP. Increased defence expenditure reinforces a strong foundation for Estonia’s defence capability and allows switching from deterrence by punishment to deterrence by denial.

On 22 February 2023, the Riigikogu approved the National Security Concept of Estonia, which states the following about defence expenses: “Due to the increased military threat of the Russian Federation, the required Estonian military defence spending is at least 3% of GDP; Estonia’s host nation support costs will come on top of it.” According to the coalition agreement and based on the National Security Concept, long-term national defence spending is guaranteed for four years at a level of 3% of the GDP, plus host national support costs. In total, defence spending this year amounts to EUR 1.3 billion, i.e. 3.21% of the GDP.

The Russian Federation’s war against Ukraine, which began on 24 February 2022, has significantly affected Estonia’s planned defence cooperation with both NATO and the European Union. At the Madrid summit in June 2022, a framework for strengthening NATO’s position of deterrence and defence was agreed upon and concrete decisions were made to strengthen NATO’s eastern flank. This includes bringing additional units to the eastern flank, creating and designating reinforcement units, prepositioning equipment and ammunition, improving the command structure, and working between the host nation and the framework nation of the eFP battlegroup to establish division-level command structures in the eastern flank countries. For Estonia, this means the development of a division-sized unit and its command structure in cooperation with allies, which began in the autumn of 2022.

In the future, the Estonian division will lead all the major land operations in Estonia in the NATO chain of command, and its composition will include the Estonian land forces and territorial defence units, the allied units permanently stationed in Estonia, and the reinforcement units of the allies to train the military defence of Estonia and the wider Baltic region within the NATO framework. This will enable the rapid deployment of the forces and capabilities located in Estonia as well as reinforcements. In the deteriorated security situation resulting from the war in Ukraine, the key allies have significantly stepped up their presence and visibility in Estonia, which ultimately increases Estonia’s security.

Defence expenditure is directed to the procurement of defence equipment.

In 2024, anti-tank, short-range anti-aircraft and artillery ammunition will be procured, as well as various small-calibre ammunition. These procurements total about EUR 1.35 billion over 2024–2027, of which an additional EUR 350 million was added by the decisions made in 2023.

The procurements for 2024 amount to approximately EUR 185 million. Loitering munition will be delivered to significantly improve the ability to affect enemy targets with precision attacks. Deliveries of the anti-ship missile system and its ammunition continue.

4×4 armoured vehicles will arrive, the conversion of CV90 combat vehicles and deliveries of K9 self-propelled howitzers will continue.

Various communication equipment will be procured. A variety of individual equipment for soldiers will be procured, improving the protection of soldiers and their ability to fight in the dark.

Regarding infrastructure, ammunition storage facilities and equipment depots, as well as infrastructure related to allies and their support will be built in 2024. A total of EUR 366 million will be invested in infrastructure between 2024 and 2027. The main runway of the Ämari Air Base will be repaired and additional aircraft shelters will be built. During the expansion of the Nursipalu training area, the establishment of a primary reception area for the allies and the design of a new home base are planned. A centre for military and disaster medicine, a combat school and a national defence building will be built in Tartu.

NATO projects involving external funding will continue in the central training area and in Ämari. Infrastructure will be built and equipment procured from the wind energy compensation measures of the Recovery and Resilience Facility. Equipment that was donated to Ukraine will be replaced using funds from the European Peace Facility.



Decision of the Government of the Republic of Estonia to strengthen crisis preparedness

The war in Ukraine confirms that Estonia can be defended if we have the will, the weapons, people with training, and the necessary reserves. The war in Ukraine is not over, but it is already clear that Estonia’s national defence decisions have been the right ones – the Ukrainian experience has only served to confirm the need for and importance of planned capabilities. On the basis of the National Defence Development Plan approved last year, decisions were taken to prioritise the development of capabilities ensuring that the increase in military defence would be as fast as possible and with the greatest impact.

In connection with the concentration of Russian Federation forces along the border with Ukraine and the tightening of the security situation, the Defence Forces and the Ministry of Defence prepared an analysis and made proposals to the Government of the Republic to initiate the necessary actions to strengthen crisis preparedness. As a result, the Government of the Republic decided in January 2022 to allocate an additional EUR 339.5 million to the Ministry of Defence to strengthen crisis preparedness for the period of 2022–2025. Most of this money will be used to procure ammunition and build the infrastructure necessary to store it.

In response to the Russian military aggression in Ukraine, the Government of the Republic did approve on 24 March 2022 a reinforcement package for Estonia’s military defence in the total amount of EUR 476.77 million, with EUR 15.44 million being allocated with the 2022 supplementary budget and EUR 461.33 million remaining in the period of 2023–2025. Additional funds were allocated to six areas: deploying short-range air defence systems, upgrading anti-tank capabilities, improving indirect fire capabilities, increasing situational awareness, building additional infrastructure to host allies, and, for the Defence League, creating greater opportunities for volunteers to participate in territorial defence. This package will ensure that brigades will be able to destroy more of their opponents than today, and it will be significantly easier to destroy the first enemy assault echelon. Enemy units entering Estonian territory would be under constant and very dangerous fire. In dark conditions, the ability to destroy and demoralise the enemy will be much greater than it is today. Conducting an air and naval offensive against an adversary will have catastrophic consequences for the adversary. The enemy’s second echelon, infrastructure, command, control, fire support, and logistics will be at risk at a distance of 50–90 km.


Last updated: 12 January 2024