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Friday, Apr 04, 2025

Greece Plans €25 Billion Defense Overhaul Amid Regional Tensions

Prime Minister Mitsotakis unveils a 12-year modernization strategy incorporating advanced technologies and Greek industry.
Greece is set to embark on a significant overhaul of its military capabilities, with a planned investment of €25 billion over the next 12 years aimed at modernizing its armed forces and bolstering local industry involvement.

This initiative, termed by Prime Minister Kyriakos Mitsotakis as the "most drastic transformation in the history of the country’s armed forces," was announced in a parliamentary session on April 2, 2025.

The strategy is built on two main pillars: the adoption of advanced defense technologies and the active participation of Greek defense industry in military procurement programs.

Acknowledging the evolving nature of warfare, Mitsotakis stated, "The world is changing at an unpredictable pace," emphasizing the necessity for Greece to enhance its military capabilities in light of regional tensions, particularly concerning its longstanding rivalry with Turkey.

This announcement comes amid growing pressure from NATO, particularly from the United States, for member countries, including Greece, to increase their defense spending.

Currently, Greece allocates over 3% of its GDP to its military budget, which is significantly above the EU average.

Mitsotakis criticized previous European defense policies as lacking strategic foresight, arguing that Europe had shifted its defense responsibilities to the United States post-Cold War, which had resulted in the erosion of its own commitments to NATO.

The new arms procurement strategy, expected to be in effect until 2036, will place a strong emphasis on cybersecurity and include the integration of advanced technologies such as unmanned ground and aerial vehicles, loitering munitions, drones, and a new communications satellite.

Central to this modernization effort is the development of the "Achilles' Shield," a proposed defensive system intended to mitigate threats from missiles, aircraft, and drones.

Mitsotakis underscored the importance of involving the Greek arms industry in these future programs, declaring this level of involvement as "a non-negotiable condition for any major defense investment."

In support of the increased military expenditure, the European Commission has announced the invocation of the EU's national escape clause, permitting military spending to be excluded from assessments related to compliance with EU fiscal regulations.

While acknowledging this flexibility, Mitsotakis warned against the potential for unsustainable fiscal practices, stressing the importance of maintaining market confidence in Greece's economic management.

The Greek government has shown its support for initiatives proposed by European Commission President Ursula von der Leyen, diverging from trends seen in other Southern European countries, which are focusing on military funding primarily through grants rather than loans.

Mitsotakis has called for discussions within the EU regarding the creation of a dedicated fund for projects of common defense interest, such as a European anti-missile shield, although specific actions towards this goal remain pending.

Alongside these defense initiatives, the Greek government recently announced its first pay increase for armed forces personnel in 14 years, aimed at attracting younger recruits into the military.

This decision, however, has led to controversy within the ruling New Democracy party, with some members advocating for broader salary increases for other uniformed sectors.

Mitsotakis indicated that further salary adjustments would be disclosed in September, while also urging caution regarding significant fiscal commitments, emphasizing that the economic performance remains critical for national security.
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