Greece to Request European Commission Approval for Increased Defense Spending

April 29, 2025 TruthUSA

Last month, European Commission President Ursula Von der Leyen modified fiscal guidelines, enabling EU nations to gather a total of $684 million for defense initiatives.

Greece’s finance minister, Kyriakos Pierrakakis, has stated his intention to request the European Commission to implement a fiscal escape clause, facilitating increased defense expenditure in Greece’s 2026 budget.

On Tuesday, Pierrakakis informed public broadcaster ERT that he would make the request later, aiming to allocate an additional 500 million euros ($569.6 million) for 2026.

He noted that this additional funding represents less than 0.3 percent of Greece’s gross domestic product (GDP).

As a NATO member, Greece currently allocates approximately 3 percent of its GDP to defense, marking one of the highest ratios within the 76-year-old alliance.

Greece has been involved in two conflicts with neighboring Turkey, in 1919–22 and 1974, and tensions persist, particularly regarding the island of Cyprus, despite both nations being NATO members.

Recently appointed as finance minister by Greek Prime Minister Kyriakos Mitsotakis, Pierrakakis aims to invest 25 billion euros ($28.4 billion) in defense by 2036 as part of a strategy to modernize military capabilities and compete with Turkey.

Greece experienced a debt crisis in 2009, which necessitated two bailouts from the International Monetary Fund (IMF) in 2010 and 2015. Nevertheless, the economy has rebounded, achieving a primary budget surplus of 4.8 percent of output last year, surpassing the government’s expectations.

‘Great Future’ for Greek–US Relationship

In the ERT interview, Pierrakakis spoke about his recent discussions with U.S. Treasury Secretary Scott Besent.

“The Greek–American relationship is a geostrategic bond with a rich history and a promising future,” he stated.

Last month, Ursula Von der Leyen unveiled a five-point action plan, ReArm Europe, aimed at boosting defense budgets in response to threats from Russia and other adversary nations.

She indicated that she would activate the national escape clause of the EU’s stability and growth pact, a little-known financial mechanism that restricts excessive borrowing by member states.

According to Von der Leyen, this would afford each EU country the ability to enhance its defense spending by 1.5 percent of GDP, potentially generating 650 billion euros ($684 billion) over the next four years.

She mentioned that EU countries are currently investing about 2 percent of their GDP in defense but need to elevate this figure above 3 percent.

This would still fall short of the 5 percent that U.S. President Donald Trump has urged NATO nations to allocate for defense.

If the escape clause is not enacted, EU member states would face penalties for exceeding a 3 percent GDP budget deficit.

On April 23, Portugal became the first nation to request the commission to activate the clause for increased defense spending.

Germany Likely to Follow Suit

Last week, German Finance Minister Joerg Kukies indicated that Berlin would likely approach the European Commission for an exemption from borrowing limits to bolster defense spending in the upcoming years.

“It seems probable we will do that, but a final decision needs to be made,” Kukies remarked during an interview at the International Monetary Fund and World Bank meetings in Washington.

He mentioned that the new German government, comprised of the conservative Christian Democratic Union and its coalition allies, is discussing the particulars.

Recently, Germany’s parliament approved plans to augment defense spending.

On April 28, German President Frank-Walter Steinmeier affirmed that NATO could rely on Berlin to enhance its contribution to Europe’s defense.

During a ceremony at NATO’s Brussels headquarters commemorating the 70th anniversary of West Germany’s entry into the alliance, Steinmeier stated: “Today, with [Russian President Vladimir] Putin’s war against Ukraine at full intensity, and the United States applying significant pressure on European allies, Germany plays a critical role.

“We have received the message; you can count on us. We will endeavor to position Germany, both its military and infrastructure, as the backbone of conventional defense in Europe.”

Reuters contributed to this report.

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