Estonian defense minister warns of sharp rise in European defense procurement costs

Estonian Defense Minister Hanno Pevkur has warned that European countries are facing significant increases in defense procurement costs as NATO members accelerate military spending and rearmament programs.

According to statements reported by Ukrainska Pravda, Pevkur said prices for some defense products have risen by 50% to 60% compared with contracts signed two years ago. He indicated that expanding procurement volumes for the same systems is now substantially more expensive due to market pressure and limited industrial capacity.

The minister said the increase in demand across NATO countries, combined with continued military assistance to Ukraine, is placing additional strain on Europe’s defense supply chains and manufacturing base.

Pevkur also described what he called a structural imbalance between governments and industry. According to the minister, defense manufacturers remain cautious about expanding production capacity without long-term contracts and procurement guarantees from governments.

He warned that Europe cannot delay improvements to military readiness until the end of the decade, citing concerns over the regional security environment and the pace of Russian military activity.

The comments come as European governments continue debating higher defense spending targets, industrial investment mechanisms, and measures aimed at strengthening NATO production capacity across ammunition, air defense, armored systems, and other critical sectors.