Assisting Kiev’s war effort without US support will be a blow to the bloc’s budget, Bloomberg economists have warned
The EU is facing extra costs of $3.1 trillion over the next decade if it wants to support Ukraine while member states build up their own militaries in the absence of US assistance, Bloomberg economists have warned.
The report follows recent warnings from Washington regarding funding cuts for Kiev. President Donald Trump has also warned that the US could cut NATO spending unless European members agree to boost their own contributions from 2% to 5% of GDP.
At a meeting with his NATO counterparts in Brussels on Wednesday, US Defense Secretary Pete Hegseth reiterated these warnings, saying European members must shoulder the burden of providing “the overwhelming share of future lethal and nonlethal aid to Ukraine” and “take ownership of conventional security on the continent.” He noted that the US will no longer be “primarily focused on the security of Europe” and will instead work on securing its own borders.
Following Hegseth’s speech, Bloomberg economists attempted to calculate how much European countries would have to spend on supporting Ukraine through potential peace talks with Russia and reconstruction, as well as revamping their own militaries.
They estimated that rebuilding Ukraine’s military could cost around $175 billion over the next decade, depending on its state and territorial realities when a settlement with Russia is reached. Another $30 billion would be required for a 40,000-strong peacekeeping force over the same period, they said, in line with reports that a potential peace deal may include deploying peacekeepers to the area. Around $230 billion more will be needed for reconstructing buildings and infrastructure in Ukraine damaged during the conflict, they estimated.
However, according to Bloomberg, the bulk of the money would be needed to improve the military capabilities of EU member states, including building up artillery stockpiles, improving air-defenses, strengthening the bloc’s eastern borders, and ramping up the European defense industry.
Despite Trump’s calls, discussions among European NATO members indicate that they find the 5% of GDP defense spending goal unrealistic, and plan to boost the aggregate defense budget toward around 3.5% of GDP. This would cost the five largest European NATO members an additional $2.7 trillion over the next decade, economists estimated.
The news outlet noted that it would be a challenge for EU states to mobilize resources on this scale, and would likely force European governments to restructure their budgets and agree to joint debt issuance. The publication warns that the bloc’s health, education, and welfare sectors would likely suffer from the burden the most.
