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Luxembourg buys armoured vehicles in €370m deal

Luxembourg buys armoured vehicles in €370m deal

by Yannick HANSEN 2 min. 15.09.2022
Acquisition to upgrade the current stock of vehicles comes as country's military spending lags behind NATO pledge it signed in 2014
The old Hummer (pictured) will be replaced by a new stock of vehicles
The old Hummer (pictured) will be replaced by a new stock of vehicles
Photo credit: Guy Jallay

Luxembourg has spent €367m to purchase 80 new armoured vehicles, Defence Minister François Bausch said on Thursday, as the country scrambles to meet its NATO pledge to spend at least 2% of GDP on defence.

The vehicles will be used for command, liaison and reconnaissance missions and will be an upgrade on the current fleet, Bausch said.

The new gear is interchangeable with the equipment Luxembourg's allies use, according to a statement from the ministry. Last year, Bausch announced the intention to set up a joint Belgian-Luxembourgish land forces battalion.

Luxembourg wrapped up the acquisition together with NATO's Luxembourg-based procurement agency NSPA, which will also assist the army in maintaining the equipment, the statement said.

The €367m price tag will also cover the logistical support and the maintenance of the vehicles. Luxembourg lawmakers signed off on the deal in December.

The purchase is part of Luxembourg's push to meet its commitment to spend at least 2% of its GDP on defence. Luxembourg and all other NATO members agreed the target in 2014, but the Grand Duchy has set a target of just 1% by 2028 - or close to €1 billion - in the wake of Russia's deadly invasion of Ukraine in February. The previous target stood at just 0.7% by 2024.

Bausch said in March that the NATO demand is "unrealistic and unachievable", adding that the Luxembourg defence budget has increased significantly since 2013 and that by 2024, an additional €382 million will have been spent over the course of the previous decade. 

As part of the spending spree, Luxembourg acquired an A400M military transport aircraft for €200m, which will ultimately cost taxpayers €420m to run over 35 years. The aircraft was deployed during the fall of Kabul when it airlifted gear back to Europe.

Despite this, Luxembourg continues to rank at the bottom of the table when it comes to spending on defence, relative to the size of the economy. The country trailed only the Republic of Ireland - which is not a NATO member - in 2019 for the lowest expenditure compared to GDP. 

The 0.4% of GDP spent by Luxembourg on defence in 2019 was just one-third of the EU average, the bloc's official statistics agency Eurostat said last year.

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