The Czech Republic fulfilled its commitment to spend 2% of its GDP on defence in 2024, the Defence Ministry said in a press release yesterday. Total defence spending for last year reached CZK 166.8 billion, which is 2.09% of GDP.
The data are based on a macroeconomic forecast issued in November. The ministry said a total of CZK 177.1 billion was allocated for defence expenditure last year, including the Defence Ministry budget as well as some items from other ministries, out of which CZK 166.8 billion was spent.
Finance Minister Zbynek Stanjura (ODS) said at a press conference that defence spending had increased in recent months. According to Prime Minister Petr Fiala (ODS), the increase of several billion crowns was to ensure that the Czech Republic would keep defence spending above 2% of GDP, as committed as part of NATO membership.
According to Stanjura, the Czech Republic has enough spare spending to be sure that it will meet the 2% goal even if NATO does not recognise some of the spending from outside the Defence Ministry. “At this point, we can confidently say, and we don’t have to worry about the methodology examination going wrong, the Czech Republic has met its Alliance commitment. Defence spending in 2024 exceeded 2% of GDP,” the minister added.
The Defence Ministry budget alone reached CZK 164.3 billion last year, spending CZK 159 billion, which the authority said was 1.99% of GDP, according to the November 2024 macroeconomic forecast.
According to the ministry, CZK 5.3 billion remained underspent, of which CZK 4 billion will remain in the fund to finance strategic projects in future years in accordance with the defence financing law. The remaining CZK 1.3 billion will be transferred to the Defence Ministry’s budget for this year.
The Defence Ministry has long faced criticism for underspending. For example, it transferred CZK 1.1 billion unspent from the previous year’s budget to last year’s budget. The authority allocated another CZK 7.77 billion from the 2023 budget to fund strategic projects in subsequent years.
The final assessment of defence spending and its recognition is the responsibility of the North Atlantic Treaty Organisation (NATO), the result of which should be known in the second quarter of this year, “both in terms of the nominal amount of spending and in relation to the actual GDP figures for 2024. The share is therefore still subject to change,” the office noted.
The Defence Ministry continued to make large military purchases last year, concluding contracts for the acquisition of 14 Leopard 2A4 tanks for CZK 3.98 billion excluding VAT, and two Embraer C-390 transport aircraft for CZK 11.3 billion excluding VAT, for example.
The authority also concluded a framework agreement for the purchase of Tatra T-815 vehicles with Tatra Defence Systems. The contract allows for the purchase of up to 872 off-road vehicles of three types for a total price of up to CZK 13.35 billion by the end of September 2031. The ministry purchased ammunition as well, for example, for the new H-1 helicopters.
In addition to the defence budget, defence expenditure also includes some items from other chapters. Last year, the defence expenditure of other institutions amounted to CZK 12.8 billion, of which CZK 5 billion was unspent by the authorities.
As well as being a NATO commitment, the 2% defence spending target has in recent years become the target of increased political attention, as US President-elect and former president Donald Trump has suggested that U.S. “protection” for other NATO members should be conditional on those countries meeting NATO defence spending targets.
