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As European NATO countries rush to strengthen their armed forces, large pension bills threaten to divert funds from urgently needed military hardware.
European NATO members are racing to boost defence capabilities amid growing security concerns over Russia and doubts about long-term U.S. support. But generous military pensions are quietly eating into defence budgets, complicating efforts to strengthen firepower.
Reuters analysis of budget data from 13 NATO members shows that pensions consume an average of 12% of defence spending - reaching nearly 20% in Belgium, Bulgaria and Italy, and 16% in France. These costs, while included in NATO’s spending figures, do not translate into new equipment or operational strength.
Germany, with a lower pension share at 11.5%, appears better positioned to expand its military capabilities, while countries like France and Italy risk falling short of NATO targets if pension costs are excluded.
Although 23 of NATO’s 32 members claim to meet the alliance's 2% of GDP spending goal, that number drops significantly when pension spending is excluded. For instance, France barely meets the threshold, and Italy has reclassified pensions to meet NATO expectations.
Some countries, such as Belgium, are considering reforms like raising the military retirement age from 56 to 67. However, adjusting pension systems is politically sensitive and may affect recruitment and morale.
"If you don’t invest in the people behind the weapons, you’ll end up with empty tanks and no one to drive them,” warned Emmanuel Jacob, head of European soldiers’ rights group Euromil.
As NATO eyes even higher spending benchmarks - up to 5% of GDP, as demanded by U.S. President Trump - Europe faces a hard choice: fund more missiles and drones, or continue supporting costly military pensions that deliver no combat edge.
Russia said on Monday that its troops had advanced in the eastern Ukrainian city of Pokrovsk, a transport and logistics hub that they have been trying to capture for over a year, but Ukraine said its forces were holding on.
At least 37 people have died and five are missing after devastating floods and landslides hit central Vietnam, officials said Monday, as a new typhoon threatens to worsen the disaster.
U.S. President Donald Trump said he does not believe the United States is going to war with Venezuela despite growing tensions, though he suggested President Nicolás Maduro’s time in power may be nearing its end.
A powerful earthquake measuring 6.3 struck near the northern Afghan city of Mazar-e Sharif early on Monday, leaving at least 20 people dead, hundreds injured, and causing significant damage to the city’s famed Blue Mosque, authorities said, warning that the death toll was expected to rise.
Tanzania's President Samia Suluhu Hassan vowed on Monday to move on from deadly protests set off by last week's disputed election as she was sworn into office for her first elected term.
Alphabet Inc., the parent company of Google, is entering the U.S. dollar and euro debt markets with a multi-tranche senior unsecured notes issue.
Microsoft has agreed a $9.7 billion partnership with data centre operator IREN, granting it access to Nvidia’s latest chips in a move designed to ease the computing bottleneck that has hampered the company’s ability to fully capitalise on the artificial intelligence boom.
Chinese electric carmaker BYD is making major strides in Europe, with sales surging nearly fivefold in September from a year earlier to just under 25,000 new registrations.
U.S. stocks were mixed late Wednesday as traders digested comments from Federal Reserve Chair Jerome Powell, who signaled that another interest rate cut in December is far from guaranteed. The Dow Jones Industrial Average and S&P 500 edged slightly lower, while the Nasdaq climbed on continued gains
U.S. chipmaker Nvidia has made history by becoming the first company in the world to reach a market value of 5 trillion dollars, driven by soaring demand for artificial intelligence technologies.
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