Abstract
The following pages bring together data on defence spending from three different sources: the International Institute for Strategic Studies (IISS), the North Atlantic Treaty Organization (NATO) and the Stockholm International Peace Research Institute (SIPRI). Data for 2016 from the EDA were not available at time of publication. IISS and SIPRI figures dis- played below are available for all 28 EU member states, whereas NATO figures are available for the 22 EU member states also party to the Alliance (EU-NATO 22 hereafter).
In contrast to previous editions of the Yearbook, data are presented in US dollars instead of euros to maintain compatibility with the full databases and international comparisons offered by each organisation. Each organisation has a different methodology for collect- ing and harmonising data between different countries, leading to slight discrepancies be- tween the datasets. After briefly explaining the methodologies of each organisation, this section commentates on the differences the data show for 2014-2016.
NATO countries send data on defence expenditures, defined as ‘payments made by a na- tional government specifically to meet the needs of its armed forces or those of its allies’, directly to the NATO Defence Planning Division, which then harmonises what each state counts and adjusts the figures according to their methodology.5 With the exception of Bulgaria, defence expenditure levels for all allies include pensions. Gross Domestic Prod- uct (GDP) levels and deflators are taken either from the OECD or DG ECFIN, and NATO uses average annual exchange rates from the International Monetary Fund (IMF) Interna- tional Financial Statistics (IFS) database.
IISS uses primary sources data (official budgetary documentation and correspon- dence with governments) to assess the defence spending levels of EU-NATO coun- tries. IISS attempts to approximate the NATO definition (e.g. by including military pensions) where data is available. In addition to reporting an independent assessment of defence budgets, the IISS Military Balance also reports defence expenditure levels ac- cording to NATO. IISS exchange rates are derived from GDP figures in the IMF World Economic Outlook database by dividing the domestic currency figure by the US dollar figure to obtain the number of units of domestic currency per US dollar. GDP deflators and inflation rates also come from the IMF World Economic Outlook database.
EUISS Yearbook of European Security 2017
Daniel Fiott 