What happened
The European Union (EU) has reallocated its defence investment strategy, prioritising conventional weaponry over advanced technologies such as drones and artificial intelligence. While overall defence spending is increasing, with a significant portion allocated to research and development and equipment procurement, traditional military assets now receive the majority of funding. The EU has earmarked €131 billion for defence and space within its 2028-2034 budget, reflecting a shift in investment focus towards established hardware.
Why it matters
This strategic shift introduces a constraint on the integration of emerging defence technologies, increasing the burden on procurement and R&D departments to justify investment in non-conventional systems. It creates a visibility gap regarding the long-term operational benefits and risks associated with advanced AI and drone capabilities, potentially increasing exposure to future technological obsolescence. This re-prioritisation also raises due diligence requirements for evaluating the strategic implications of a less diversified defence technology portfolio.
