Denmark allocates additional EUR6 billion to defence budget to accelerate build-up

The Danish government has decided to allocate an additional EUR6.7 billion euros to its defence budget and accelerate its build up over the next two years, as its intelligence services anticipate a resurgent Russia within two years of the war in Ukraine ending. 

The additional budget will be used to set up an Acceleration Fund and is in addition to Denmark’s existing defence budget, bringing the country’s projected defence budget to more than 3% of its GDP. The fund will be used to enable “rapid investments in fighting capability that will strengthen the Danish Defence in the short term,” according to announcements made by the Danish MoD on the 19th and 22nd February. The additional fund can also be used to procure equipment for Ukraine and to fund reorganisations within the Danish forces, the release states. 

“Within two years, Russia could pose a credible threat to one or several NATO-countries if NATO does not build up its own military power at the same rate as Russia. This calls for swift, political action,” the Danish Defence Minister, Troels Lund Poulsen said. “The urgency of the situation means that we need to be able to invest in and build-up fighting capability at increased speed. We only have a limited influence on production times, but if we use our right to award contracts directly, we can save time,” he added. 

The proposal was made by the Danish government on the 19th of February, and approved on the 22nd. The government will also look again at increasing the country’s defence budget after NATO capability targets are released later this year. 

Denmark has made significant donations to Ukraine from its own existing ammunition and vehicle stocks, including all 19 of its Caesar howitzers, the country also donated its entire stock of artillery ammunition according to announcements made by Prime Minister Mette Frederiksen in February 2024. It has additionally allocated around EUR6 billion in funding for the procurement of weapons and equipment, much of which is ordered from Ukraine’s domestic defence industry. It was the first nation to donate F-16s, and has also supplied Patriot air defence missiles. 

Calibre comment

Several European countries, including Denmark have embarked on joint procurements since 2022, typically seeking to buy the same platform without making national modifications in the factory. This speeds up production and helps manufacturers plan more effectively around supply chains. Examples include the CV90 joint procurement between Denmark, Sweden, and Ukraine; the Common Armoured Vehicle System (CAVS), which now includes Finland, Germany, Latvia, and Sweden; and the joint Anti-Submarine Warfare vessel procurement between the Netherlands and Belgium. Denmark may be able to use similar frameworks to speed up its procurement and more rapidly rebuild its armed forces.