European states could face a $1 trillion re-armament bill in response to the growing threat from Russia and a looming U.S. defense review that may result in a sharp drawdown of American forces on the continent, according to a report released on Wednesday.
The 106-page report by the London-based International Institute for Strategic Studies (IISS) highlights major shortfalls across Europe’s defense sector, including in production, intelligence, long-range strike capabilities, and integrated air and missile defense systems.
“One of the main drivers behind this growing urgency is the Russian military threat, combined with uncertainty over the U.S. commitment to defending its European allies,” the report stated.
NATO Concerns Over U.S. Cuts
The Pentagon’s Global Force Posture Review, expected later this month, is anticipated to shift U.S. military resources from Europe to the Indo-Pacific. According to NATO officials, a reduction of up to 30% of U.S. troops stationed in Europe is possible.
Rising Budgets, Limited Capacity
European leaders have already pledged billions in new defense spending. In March, during an EU summit, they committed to increasing military budgets, with European Commission President Ursula von der Leyen calling it a “defining moment for Europe.”
EU-backed loans worth up to €150 billion have been made available to member states, while Eurozone debt rules have been eased to accommodate defense expenditures. NATO members also agreed in June to raise defense spending to 5% of GDP.
However, the IISS report warns that the challenge is not only financial. Europe’s defense industries are struggling to scale production, while many national militaries are falling short of recruitment targets.
Vulnerabilities in Air and Missile Defense
The report highlights Integrated Air and Missile Defense (IAMD) as a critical vulnerability. Current and former U.S. commanders told Radio Free Europe/Radio Liberty that Europe’s air shield is not prepared to withstand a Russian-scale threat.
“What you see happening in major Ukrainian cities could happen in Europe’s large cities as well,” warned Philip Breedlove, former NATO Supreme Allied Commander.
Long-Range Strike Gaps
While Europe fields highly effective air-launched cruise missiles such as the Storm Shadow/Scalp and Germany’s Taurus, only a few allies possess land-based precision strike systems. At sea, only France and the United Kingdom have ship-launched land-attack cruise missiles with a 1,000 km range.
The most ambitious initiative is the European Long-Range Strike Approach (ELSA), launched by France, Germany, Poland, and Italy, and later joined by the UK, Sweden, and the Netherlands. The project aims to develop ground-attack capabilities with ranges up to, and potentially beyond, 2,000 km.
Political and Financial Trade-Offs
Other gaps include a lack of reconnaissance aircraft, large-scale sovereign data processing capabilities, and slow, fragmented procurement processes.
The report warns that addressing these weaknesses will come at a high cost:
“Meeting these challenges will require many European NATO allies to take significant financial risks and make very difficult political decisions.”
