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NATO Defence Expenditures and Economic Data Summary (2014 and Estimates for 2015)

Core Content

NATO published defence expenditures data for 2014 and estimated figures for 2015. The data are based on the NATO definition of defence expenditure, which may differ from national definitions, leading to discrepancies with national budget figures. The data includes various tables and notes to clarify the methodology and context of the figures.

Main Points

• Defence Expenditures: The figures in Table 1 represent actual or estimated payments for the fiscal year, based on the NATO definition of defence expenditure.
• Currency Changes: From 2002, most NATO members expressed data in Euros. Exceptions include:
  • Canada and the United States using their own currencies.
  • The UK and US using a resource-based accounting system starting in 2005 and 2006 respectively.
  • Turkey using a new currency unit from 2005.
• Data Adjustments:
  • From 2004, the NATO definition excluded "Other Forces" except for those structured, equipped, and trained to support defense.
  • Some countries, such as France, Greece, Hungary, Italy, Luxembourg, Portugal, and Turkey, experienced apparent decreases in defence expenditure due to the new definition.
  • In some cases, data excluded non-deployable elements or included them, depending on the year.
• Pensions: In 2002, NATO started including pensions in defence expenditure data for some countries. From 2009, a new methodology was used to calculate pensions.
• Country Notes:
  • Iceland has no armed forces.
  • The Czech Republic, Hungary, and Poland joined NATO in 1999.
  • Bulgaria, Estonia, Latvia, Lithuania, Romania, the Slovak Republic, and Slovenia joined in 2004.
  • Albania and Croatia joined in 2009.

Key Tables

• Table 1: Defence expenditures for each NATO member and the total.
• Table 2: Annual percentage change in GDP and defence expenditure (based on 2010 prices).
• Table 3: Defence expenditures as a percentage of GDP.
• Table 4: GDP and defence expenditures per capita.
• Table 5: Distribution of defence expenditures by category.
• Table 6: Armed forces personnel strength.

Notes on Data Interpretation

• Currency Conversions: Data for nine European NATO members were expressed in national currencies up to 2001, then switched to Euros.
• Fiscal Years: For some countries, the fiscal year is designated by the year with the most months, e.g., 2013 represents 2013/2014 for Canada and the UK, and 2012/2013 for the US.
• Rounding: Totals may differ slightly from the sum of individual components due to rounding.

Key Information

• Defence Expenditure Categories: Includes personnel, equipment, and R&D.
• R&D and Equipment: R&D related to major equipment is included in equipment expenditures. Pensions are included in personnel expenditures.
• Defence Expenditure Trends:
  • Some countries showed a decline in defence spending due to the revised definition.
  • Others showed more stable or increasing trends.
• GDP Trends:
  • Varies by country, with some experiencing growth and others contraction.
  • Data is presented in both current prices and 2010 prices for comparison.

Summary of Tables

Additional Notes

• Exchange Rates: For some countries, data are expressed in US dollars for comparison.
• GDP and Defence Expenditure Trends:
  • Table 2 provides annual percentage changes for GDP and defence expenditures based on 2010 prices.
  • Some countries experienced negative changes in defence expenditure, while others showed growth.
• Data Availability: Some entries are marked as "not available" (//), "not applicable" (//), or "not applicable" (|) due to data unavailability or specific reporting rules.

Conclusion

This document provides a comprehensive overview of NATO member countries' defence expenditures and economic data, highlighting the differences in reporting standards and currency conversions. It is essential for understanding the financial commitments of NATO members and their economic context, especially in light of the revised NATO definition and changes in accounting practices.