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Defence expenditure – Albania – 2024

Despite the notable growth in Albanian defence expenditure over the last five years, the expenditure remains below the NATO commitment of 2% of GDP for defence spending. Nevertheless, the planned budget for 2024 indicates a substantial increase compared to 2023, suggesting that the NATO goal should be reached in 2024. The defence expenditure’s share in Albania’s total government expenditure is continuously increasing. Based on the latest Budget Law amendments from 2023, it is planned to reach 9.18% of total government expenditure.

2023

Share of GDP 1,63%
Share of total government
expenditure 9,18%

The balance sheet for the year 2022 (adopted in May 2023) indicates a significant deviation from the initial budget, a variance not observed in the preceding years. The budget is usually underspent, which is a trend that appears to persist in 2023.

The defence budget structure is not evident from Albanian official documents that are publicly available, which is why the NATO database was used for this purpose. Personnel spending has significantly decreased in 2023, while the increase in arms and equipment spending is considerable.

During 2022 the salaries of the Albanian armed forces were increased by 30%. The increase will continue in 2023 by 7% for all ranks, which
explains the decrease in spending on personnel compared to 2022. In the beginning of 2023, Albanian Minister of Defence announced procurement of the unmanned combat aerial vehicles – TB2 armed drones, from the Turkish company “Baykar Technologies”, as well as building of the cyber field operational centre.

2024 – Balkan Defence Monitor
Defence Expenditures – Albania

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Defence expenditure – Serbia – 2024

The observed trend of rise in Serbian defence expenditure since 2016 halted in 2022, with expenditures falling below the figures recorded in 2021. As the balance sheet for 2023 has not been adopted yet, the actual military expenditure for the year remains unavailable. Nevertheless, based on the most recent amendments to the Budget Law, it is anticipated that military spending in 2023 will be on the rise again, constituting an 8.05% share of the total expenditure.

2023

Share of GDP 2,05%
Share of total government
expenditure 8,05%

The National Assembly usually adopts the budget for the forthcoming year in early December. The planned budget for 2024 is decreased by almost 1.3% comparing to 2023.

 

Serbian budget is broken down into programmes, presenting budget funds for specific areas as well as different sources of funds. Despite that, the budget is not sufficiently disaggregated and detailed, which prevents comprehensive oversight. For instance, arms and equipment costs are not disaggregated by concrete projects, and it is thus impossible to connect them to individual procurement projects. Within the programme “Functioning of the MoD and the Serbian Army” the largest part of the budget is spent on the purchase of arms and equipment, without specifying which arms and which equipment. It should also be noted that the operating costs, including costs of maintenance, spare parts, fuel, and everything that is needed for training, exercise, and general building capabilities, are relatively low compared to the amount spent on purchase of arms and equipment. The information about the procurements can usually be found in MoD’s announcements, such as the announcement about procurement and modernization of 92 complex combat platforms for the needs of the Serbian Armed Forces, but even in those sources of information further details cannot be found.

2024 – Balkan Defence Monitor
Defence Expenditures – Serbia

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Defence expenditure – Serbia – 2023

Serbian defence expenditure kept gradually rising since 2016, with a sharpest increase in 2021. Military spending took up an increasing share of the total expenditure, from 4% in 2017 to almost 8% in 2022.

The National Assembly usually adopts the budget for the forthcoming year in early December. Balance sheets presenting the actual budget spending were late for 16 years, and the National Assembly retroactively adopted all of them in 2019.

2022

Share of GDP 2.15%
Share of total government
expenditure 7.67%

The Serbian defence budget undergoes major changes as the year progresses. Resources are allocated from budget reserves, predominantly for arms and equipment. In the absence of extraordinary circumstances that would require extreme measures, such radical increases indicate
lack of comprehensive defence planning.

 

Serbia has been applying programme budgeting since 2015. The budget is therefore broken down into programmes, presenting budget
funds for specific areas as well as different sources of funds. Still, the budget is not sufficiently disaggregated and detailed, which prevents comprehensive oversight. For instance, arms and expenditure
costs are not disaggregated by concrete projects, making it impossible to connect them to individual procurements.

As can be seen from the budget structure, the upsurge in the military budget is the result of increasing arms and equipment costs, but also a gradual increase in personnel costs since 2021. In line with the above, a trend of decreasing the amount of other costs (which includes maintenance and operational costs) can be observed.

2023 – Balkan Defence Monitor
Defence Expeditures – Serbia

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Defence expenditure – North Macedonia – 2023

North Macedonian defence expenditure increased approximately 30% from 2017 to 2020. Further increases were planned after the country became a member of NATO in 2020. Before that, it was
spending roughly 1% on the military. Defence expenditure has taken up an increasing portion of the total government spending, from 2.7% in 2017 to 5.2% that was planned for 2023.

2022

Share of GDP 1.64%
Share of total government
expenditure 5.02%

The Assembly of the Republic of North Macedonia usually adopts budget laws in late December, while balance sheets are adopted regularly, with some occasional delays. The MoD regularly publishes semi-annual budget realisation reports.


North Macedonian defence budget changed in 2021, as the country signed the contract to buy Stryker light armoured vehicles. This purchase altered the budget structure in favour of arms and equipment.

Similar to other countries in the region, North Macedonia uses programme budgeting, which is not sufficiently disaggregated. Budgets and balance sheets show highly aggregated sums for different programmes, and sources of funding are presented for the entire MoD budget.

2023 – Balkan Defence Monitor
Defence Expenditures – North Macedonia

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Defence expenditure – Montenegro – 2023

Montenegrin defence expenditure experienced a big increase right after the country joined NATO, in 2018 and 2019, caused by the attempt to meet the commitments made to the Alliance. However, it went backx to its earlier level in 2020. Besides the pandemic, the change of government after the 2020 elections and the subsequent
political crisis have certainly also influenced the overall budget and defence planning for the forthcoming period.

2022

Share of GDP 1.64%
Share of total government
expenditure 5.02%

The Parliament adopted the 2021 budget after a delay of more than six months. Earlier, the Government would usually provide a budget proposal to the Parliament one month before the start of the next budget year. The Parliament has never adopted any balance sheet submitted by the government even, though it is legally required to do so.

 

Montenegro spends the greatest share of its defence budget on personnel. This trend was shortly interrupted by the increase in arms and equipment expenditure in 2018 and 2019, when Montenegro started the procedure to procure Bell helicopters and Oshkosh armored vehicles. Nevertheless, big leaps in defence spending during the year, allocated to arms and equipment, suggest a general lack of long-term defense planning in Montenegro.

Even though the Montenegrin budget demonstrates a slightly higher level of transparency than those of most countries in the region (i.e. it shows individual projects or procurement), it still lacks sufficient transparency and disaggregation.

* Data for 2021 and 2022 are based on the last changes in the 2021 budgets and the initial budget laws for 2022.

2023 – Balkan Defence Monitor
Defence Expenditures – Montenegro

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Defence expenditure – Bosnia and Herzegovina – 2023

Military expenditure of Bosnia and Herzegovina has been almost the same in the past five years, both nominally and as the share of GDP.¹

The Parliamentary Assembly has not adopted a federal budget in a timely manner since 2018.
The budget is usually adopted during, or at the end of, the year to which it pertains. Due to a political
crisis, the federal budget for 2021 was not been adopted at all, and quarterly decisions on temporary
financing were adopted on the basis of the 2020 expenditure. The 2022 budget was adopted only
in July, while the budget for 2023 has not been adopted yet. Balance sheets, presenting the actual
expenditure, are adopted regularly and in a timely fashion.

2021

Share of GDP 0.74%

 

Almost 90% of the defence budget in 2021 and 2022 was spent on personnel due to the political deadlock, which obstructed planning and allocation of resources. Bosnia and Herzegovina generally spends the largest portion of its defence budget on personnel costs, while the arms and equipment share has not exceeded 4% since 2017. Budget and balance sheets contain aggregated sums and sources of funding for rather general categories of expenses. For instance, arms and equipment expenses can be found under the aggregated category Equipment Procurement. The documents also include narrative reports with the rationale behind some general categories, i.e. monthly personnel turnover.

    1. Due to the complexity of the budget system, it is methodologically challenging to calculate the military expenditure of BiH as a share of the total government expenditure, comparable to other countries in the region. Namely, the two entities have independent budgets that, then, allocate funds upward to the federal budget, which includes the defence budget.

2023 – Balkan Defence Monitor
Defence Expenditures –
Bosnia and Herzegovina

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2023-DE-Albanija

Defence expenditure – Albania – 2023

Albanian defence expenditure has experienced a steady increase since 2017, with the exception of 2020, when spending on defence stagnated. Even though it has not reached the NATO goal of 2%
of GDP, the defence expenditure’s share in Albania’s total government expenditure increased from 4.5% in 2017 to almost 9% planned for 2022.

2022

Share of GDP 1.67%
Share of total government
expenditure 8.86%

The Albanian defence spending does not deviate significantly from the budget (+- 4%). In fact,it is usually slightly underspent.

 

The Albanian defence budget is the least transparent and detailed in the region, as it shows only several general categories: Planning, Management and Administration, Combat Forces, Military Education, Combat Support and Health Support. Hence, the publicly available information makes the budget structure and the amounts spent on personnel, or on arms and equipment, inconclusive. Data provided to NATO show that the gradual rise of the Albanian defence expenditure can be attributed to small increases in the arms and equipment
spending each year. On the other hand, personnel costs have faced a downward trend since 2017. In 2022, Albania announced the procurement of Javelin anti-tank missiles and Bayraktar drones.

    1. The Albanian budget structure graph was designed using information from the NATO database. Since it could not be derived from the government balance sheets or budgets due to the highly aggregated structure of the documents, it should not be directly compared with the budget structure of other countries in this report.

2023 – Balkan Defence Monitor
Defence Expenditures – Albania

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2023-SD-BIH

Strategic Document – BiH – 2023

NATIONAL SECURITY STRATEGY: 2006
NATIONAL DEFENCE STRATEGY: 2008

NO CHANGES IN 2022

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National interests and goals (as defined in the Strategies):
Protection and consolidation of National interests and goals (as defined in the Strategies): Establishing and developing security system institutions that will be able to respond to all risks and threats // Accession to international security conventions, European and Euro-Atlantic structures

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Main threats:
Political and social animosities caused by the war and nationalist extremism // Incomplete implementation of the Dayton Peace Agreement // Problems related to political transition // Critical regional points, such as Kosovo and Metohija.

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Main principles of national security policy:
Democratic, civilian control of the military and parliamentary oversight // Transparency of defence-related activities, including defence planning and budgeting // Integration into Euro-Atlantic collective security structures

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Regional cooperation:
Bosnia and Herzegovina has no territorial claims involving neighbouring and other states, nor does it perceive neighbouring and other states as hostile and a possible threat to its territorial integrity and sovereignty. Therefore, it is especially important that BiH further develops good neighbourly relations based on the principles of equality and cooperation. Improving good relations and cooperation with neighbours and countries in the wider region, the development of democratic processes in these countries, and the process of their European integration have a positive impact on strengthening the internal security of Bosnia and Herzegovina.

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Regional threats:
South-east remains the most sensitive area of today’s Europe. Efforts toward secession, autonomy and independence of certain ethnic groups are still present in this area, which, together with the relatively high concentration of military capacities, further complicates the overall security situation.

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Relations with NATO:
The key element for achieving the unquestionable collective military security of Bosnia and Herzegovina is to become a member of NATO, as in that case its national sovereignty and territorial integrity would be guaranteed by the Alliance. Membership in the Partnership for Peace is the first step in that direction. Further reform in the field of defence, which will lead to full professionalisation, equipping and training the BiH Armed Forces in accordance with NATO standards, will enable BiH to make a significant contribution to achieving the goals of the Security Policy in the future.

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Relations with the EU:
The commitment to gradual integration into the European Union implies readiness to accept the provisions, legal structure and organisational mechanisms of the EU’s Common Foreign and Security Policy.

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International military cooperation:
As an active participant in collective security at the global level through membership in the United Nations, the OSCE and the Council of Europe, Bosnia and Herzegovina is engaged in international peace efforts.

2023 – Balkan Defence Monitor
Strategic Documents – Bosnia and Hezgegovina

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2023-SD-Albanija

Strategic Document – Albania – 2023

NATIONAL SECURITY STRATEGY: 2014
NATIONAL DEFENCE STRATEGY: 2015

NO CHANGES IN 2022

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National interests and goals (as defined in the Strategies):
Protection and consolidation of the sovereignty, territorial integrity and independence of the Republic of Albania // Strengthening fundamental freedoms, human rights and the rule of law // Protection and promotion of the interests of Albanians wherever they may be // Preservation and development of national identity

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Main threats:
Organised crime // Corrupt individuals // Terrorism // Proliferation of weapons ofmass destruction and long-range weapons

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Main principles of national security policy:
Accountability and transparency // Activities of the Armed Forces based on the Constitution and subject to democratic control of competent institutions // Small, efficient and profiled force based on personnel rather than heavy weaponry // Promoting gender equality and increasing women’s participation

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Regional cooperation:
Peace, stability and prosperity in the region are of strategic importance to Albania. Our interest is to have a region that is integrated into the European and Euro-Atlantic structures, where inter-ethnic and inter-religious harmony reigns. This will be realised through good neighbourly relations, cooperation in good faith, respect for minorities and inclusion. Relations between the countries of the region have improved, and cooperation has increased both qualitatively and quantitatively. Integration processes are catalysts for democratic reform, cooperation, good neighbouring relations and the reconciliation process. Promoting sustainable economic development will be achieved through deep regional economic integration aimed at creating an open and free regional market as a precondition for the region’s European and Euro-Atlantic integration.

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Regional threats:
Problems in the region can still be caused by extreme nationalism. The existence of divided societies continues to pose a potential threat, due to the potential reopening of the border issue. Political exploitation and failure to exercise the rights of certain ethnic or minority groups could continue to cause sporadic tensions and generate negative consequences in bilateral and multilateral relations. Unresolved interstate disputes and problems can affect the quality of regional cooperation and good neighbourly relations, slowing down integration
processes.

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Relations with NATO:
Membership in the North Atlantic Alliance is an inherent guarantee of national security, and the Republic of Albania is committed to fulfilling the obligations arising from saidmembership.

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Relations with the EU:
Albania’s membership in the European Union is the country’s most important strategic goal for the next decade. EU integration is also linked to the country’s participation in the European Union’s Common Foreign and Security Policy and the Common Security and Defence Policy.

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International military cooperation:
Albania is committed to actively promoting regional and global peace and stability, increasing its role in regional and international organisations, and to participating in missions led by the UN, NATO and the EU.

2023 – Balkan Defence Monitor
Strategic Documents – Albania

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2023-SD-Croatia

Strategic Document – Croatia – 2023

NATIONAL SECURITY STRATEGY: 2017
NATIONAL DEFENCE STRATEGY: 2002

NO CHANGES IN 2022

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National interests and goals (as defined in the Strategies):
Security of the population // Territorial integrity and sovereignty of the Republic of Croatia // Strengthening the international reputation and influence of the Republic of Croatia // Ensuring the survival, protection of the identity and the political subjectivity of the Croatian people as constitutive in Bosnia and Herzegovina // Protection and support of Croats in other countries, and emigration

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Main threats:
Unresolved issues on delimitation with certain neighbouring countries // Political and intelligence activities of countries and non-state factors that perceive the European Union and NATO as a security threat // Terrorist attacks

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Main principles of national security policy:
Parliamentary, professional and civil oversight of the legality of the work of the security and intelligence system // Inclusion of population in the civil protection system

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Regional cooperation:
The Republic of Croatia emphasises investing in the stability of the Southeast neighbourhood, viewing the Euro-Atlantic integration and the implementation of reforms as key factors and instruments for achieving stability and security. The Republic of Croatia will therefore systematically act in support of democratic processes, stabilisation, and access of countries in Southeast Europe to Euro-Atlantic integration. The Republic of Croatia will endeavour to seek a solution to the open issues of delimitation through direct negotiations or through proceedings before an international judicial body.

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Regional threats:
Political instability, underdeveloped state institutions, corruption, the high unemployment
rate and social and ethnic tensions make the security situation in our Southeast neighbourhood fragile. Although Euro-Atlantic influence is still dominant, the space is also open to the influence of other global and regional actors and geopolitical competition and various destabilising external influences are reflected in this area as well. The Croatian neighbourhood shows trends of increasing intolerance, radicalism and extremism, especially Islamist radicalism.

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Relations with NATO:
For the Republic of Croatia, NATO is the guarantor of peace, stability andsecurity. The membership of the Republic of Croatia in NATO provides a convincing guarantee of collective defence as an important factor in deterring and defending the population, territory, and national sovereignty. Appropriate military and civilian capabilities for deterrence and defence will be developed to carry out the tasks of the NATO Preparedness Action Plan as a contribution to the credibility of Allied solidarity and NATO cohesion.

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Relations with the EU:
The Republic of Croatia will actively contribute to missions and operations within the Common Security and Defence Policy of the European Union and participate in the association and the sharing of initiatives and projects of the European Defence Agency.

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International military cooperation:
The Republic of Croatia will contribute to the efforts aimed at strengthening international security and stability by participating in international missions and operations, as well as crisis response operations of international organisations, in particular the United Nations, NATO, the European Union, OSCE, and the Council of Europe.

2023 – Balkan Defence Monitor
Strategic Documents – Croatia

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