1695924273 Almost 70 percent more Moscow will significantly increase military spending

Almost 70 percent more: Moscow will significantly increase military spending in 2024 news

This sum would be equivalent to about six percent of Russia’s gross domestic product (GDP). This year, the share of GDP is 3.9 percent. Kremlin spokesman Dmitry Peskov justified the sharp increase in defense spending with the “hybrid war being waged against us.” Russian defense spending next year will be three times higher than spending on education, environmental protection and health combined, according to calculations by the AFP news agency.

According to Portal, 12% more was spent on defense in the first half of the year than the almost five trillion rubles planned for the year as a whole. Spending on weapons production and the armed forces has increased since the start of the offensive – despite persistently high inflation and a weak ruble. The ruble has lost 30% of its value against the dollar since the beginning of the year. This development has an impact on the economy.

Warning of growing deficit

The Russian budget deficit has increased significantly. In the first half of the year, the Russian Ministry of Finance reported 2.82 trillion rubles – this is 1.8% of GDP. Russian Finance Minister Anton Siluanov had already admitted in the summer that the deficit could increase to 2.5% of GDP. Previously, Siluanov always emphasized that Russia remained faithful to the target of a deficit of no more than 2% of GDP.

Russian Finance Minister Anton Siluanov

Portal/Anton Vaganov The Russian finance minister acknowledged that the deficit could increase

However, Russia has sufficient resources to cover planned expenses, Siluanov said. To fill the budget holes, the government turned to the National Wealth Fund, worth around 551 billion rubles this year.

Weak ruble fuels inflation

The Russian central bank recently warned of a slowdown in economic growth in the second half of the year. The main reason for this is high military spending, as well as sanctions and the associated lack of revenue from oil and gas sales to Europe.

A few days ago, Russian President Vladimir Putin seemed less pessimistic. He expects economic growth of 2.5 to 2.8 percent this year. However, Putin called on the central bank to take measures to support the ruble. Its weakness is the main factor in the increase in inflation, which was 5.2% in August.

NATO Secretary General Jens Stoltenberg

Portal/Gleb Garanich Stoltenberg visited Kiev on Thursday for the second time since the start of the war

NATO countries reinforced the two percent target

Faced with the threat from Russia, NATO countries reinforced their common goal for national defense spending. Previously, it was planned for alliance states to move closer to the benchmark of spending at least two percent of GDP on defense by 2024. At the NATO summit in July, the target was set more clearly at at least 2%.

Although the Baltic States called for an even larger increase, Germany wanted to keep the spending target as vague as possible. A few days ago, NATO Secretary General Jens Stoltenberg reminded Berlin of the two percent target: “It makes a huge difference for the alliance whether the largest country in Europe sticks to this target or not.”

Stoltenberg also traveled to Kiev on Thursday for the second time since the start of the war. For security reasons, the visit had previously been kept secret. At a joint press conference with Ukrainian President Volodymyr Zelensky, he said that Ukraine’s membership of NATO was only “a matter of time”. At the meeting, Zelensky called for more support from NATO, especially to guarantee Ukraine’s air defense.