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Germany Says New Debt Needed to Strengthen Defence

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Germany needs to take on new debt to strengthen its defence and infrastructure, Finance Minister Lars Klingbeil said while defending the government’s 2027 budget. He argued that increased borrowing is necessary to address growing security threats and years of underinvestment. Germany plans to borrow €838.2 billion between 2027 and 2030, while total investment is expected to rise to €117.5 billion in 2027 from €78.9 billion in 2025.

Defence spending is set to increase significantly, with core defence expenditure projected at €109 billion in 2027, up from €82.2 billion in 2026. Including support for Ukraine and other security measures, total defence and security spending will reach €130.1 billion. Klingbeil said the increased spending is intended to protect Germany from potential conflict, amid concerns over Russia and growing cyber and hybrid threats.

The government’s spending plans face political challenges after the far-right Alternative for Germany (AfD) won a state election in Saxony-Anhalt, exposing divisions within the ruling coalition. Klingbeil also defended the investment programme as a way to revive Germany’s weak economy. The economy grew 0.3% in the second quarter, while several economic institutes have raised their growth forecasts for 2026 and 2027, citing stronger government spending.

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Germany Probes Suspected Arson at Defence Firm

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German authorities are investigating a suspected arson attack at a construction site outside the Munich headquarters of defence technology company Rohde & Schwarz. Police arrested a 28-year-old woman and a 38-year-old man, both Bulgarian, who are suspected of throwing incendiary devices. The fire caused no significant damage and no injuries were reported.

The incident comes amid growing concerns across Europe over possible sabotage targeting critical infrastructure. Germany has faced two suspected attempts to disrupt its electricity grid in recent days, while authorities are also investigating a drone incident at Leipzig/Halle airport that Germany and its allies have linked to Russia. Moscow has denied involvement.

Security concerns are spreading beyond Germany, with Denmark’s intelligence service saying Russia has attempted to recruit Danish citizens online to gather information on defence companies and infrastructure. German investigators are also examining possible international links to the Leipzig drone incident as European governments increase vigilance over potential foreign-backed sabotage.

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Poland Boosts Domestic Defence Production as It Builds Europe’s Largest Army

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Poland is increasingly turning to domestic and Central European defence companies as it builds what officials describe as Europe’s largest army. Defence procurement from Polish and regional firms has nearly quadrupled since 2022, reaching 30.4 billion zlotys ($8.15 billion) last year. The shift is aimed at reducing reliance on distant suppliers and strengthening supply-chain security.

Poland is expected to spend about €53 billion on core defence this year, equivalent to around 4.7% of GDP. While major U.S.-made systems such as Patriot missile batteries, Abrams tanks and F-35 fighter jets remain important, Warsaw is prioritising greater local production of drones, ammunition and other frequently used equipment. The strategy reflects a wider European effort to rebuild defence manufacturing capacity following the war in Ukraine.

Companies from across Central Europe are responding to the opportunity. Czech defence group CSG has agreed to expand production in Poland, including projects involving drones, missiles, ammunition and armoured vehicles, while other firms are developing ammunition and air-defence manufacturing facilities. Poland’s armed forces have surpassed 220,000 personnel, and officials say foreign companies seeking access to the Polish market will increasingly be expected to invest locally, transfer technology and participate in joint projects.

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Germany May Blame Russia for Airport Drone Attack

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Germany is expected to blame Russia for an attempted drone attack targeting a Ukrainian cargo plane at Leipzig/Halle Airport in August, according to two sources. The government may also consider imposing new sanctions against Moscow in coordination with its allies.

Airport workers reportedly discovered a drone carrying explosives and a detonator at the airport, which serves as an important civilian freight and NATO logistics hub. Germany had previously described the incident as part of a wider hybrid war against Europe without directly accusing Russia.

Foreign Minister Johann Wadephul indicated that Germany was considering further measures against Russia, saying the country would respond when attacked. Russia has previously rejected accusations of involvement, calling them a fabricated provocation.

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Sweden Orders Four French Warships

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Sweden has signed an order for four frigates from French defence company Naval Group, in a deal aimed at strengthening the country’s military capabilities. The agreement was signed in Stockholm in the presence of French President Emmanuel Macron and Swedish Prime Minister Ulf Kristersson.

Sweden has accelerated defence spending since Russia’s invasion of Ukraine in 2022, which led the country to abandon its longstanding policy of military neutrality. European nations have also been boosting defence budgets amid growing concerns over security and uncertainty about the level of future U.S. support.

The deal, announced in May at a value of around $4 billion, is expected to triple Sweden’s air-defence capacity. The four frigates will be the largest ships in the Swedish Navy, with the first vessel scheduled for delivery in 2030. Macron said the agreement would strengthen Europe’s defence industry and its ability to take greater responsibility for regional security.

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Germany Finalising Response to Suspected Leipzig Drone Attack

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German Chancellor Friedrich Merz said on Sunday that Germany is finalising its response to the suspected drone attack near Leipzig/Halle airport earlier this month. He said the government was coordinating its actions with European Union and NATO partners, with an announcement expected in the coming days.

The incident took place on August 4, when a drone carrying explosives was discovered near a Ukrainian Antonov cargo aircraft used to transport military supplies. Germany has not officially identified those responsible, although Interior Minister Alexander Dobrindt described the incident as a potential “hybrid attack scenario” and raised the possibility of foreign involvement.

German media have reported that Berlin could publicly blame Russia and introduce sanctions in coordination with EU partners. Merz did not comment on the suspected perpetrator but said Germany’s response had been agreed in principle and that its European and NATO allies would be involved in the final decision.

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Sweden to Deploy Gripen Jets and Warships to Finland

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Sweden will deploy Gripen fighter jets and a corvette warship to help monitor and protect Finnish territory until at least the end of 2026, Finland’s Defence Forces said on Friday. The deployment comes as security concerns rise along NATO’s northern borders with Russia.

Swedish Defence Minister Pal Jonson said Finland had requested stronger air-defence support because of the deteriorating security situation. Sweden may also provide vessels equipped with drone-fighting capabilities and ground-based anti-drone systems, while its forces could assist Finland in responding to violations of Finnish territory if necessary.

Sweden and Finland, which are both among NATO’s newest members, have close defence ties. Finland shares a 1,340-km border with Russia, while recent drone incidents across the Baltic region have increased concerns about the Ukraine war spilling over into neighbouring NATO countries. Separately, Swedish defence company Saab secured a 1.2 billion crown ($126 million) order from Finland for RBS 70 NG portable air-defence systems.

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Romania Destroys Marine Drone Near Major Black Sea Gas Project

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Romania scrambled F-16 fighter jets to destroy a marine drone spotted just a few hundred metres from the Neptun Deep offshore gas project in the Black Sea, Defence Minister Radu Miruta said on Thursday. The drone was later destroyed completely by a Romanian vessel after being hit by the fighter jets.

Miruta said the drone contained explosives and was destroyed to protect hundreds of workers and safeguard the country’s critical energy infrastructure. Ukraine confirmed that the drone did not belong to its forces, while Romania did not identify its origin.

Romanian President Nicusor Dan blamed Russia for what he described as a growing series of irresponsible incidents. The development comes as security concerns increase around Black Sea energy and shipping routes, with Neptun Deep expected to help make Romania the European Union’s largest gas producer when production begins in 2027.

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Norway Expands Arctic Brigade as NATO Strengthens Northern Defences

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Norway expanded its Finnmark Brigade on Thursday as the NATO member strengthens its military presence in the Arctic following Russia’s invasion of Ukraine. The brigade, established last year as Norway’s second military brigade and the first created since the end of the Cold War, is headquartered in the country’s northern Arctic region.

The expansion adds an artillery battalion, an air defence battery and a communications company to the brigade. These capabilities will allow Norwegian forces to strike targets on land at longer distances and coordinate operations with Norwegian and NATO aircraft and naval forces. The brigade has also been responsible for monitoring and patrolling Norway’s 198-km border with Russia.

Norway has significantly increased defence spending in recent years, with NATO estimating that military expenditure will reach 3.17% of GDP in 2026, compared with 1.5% in 2014. Norwegian officials say the strengthened Arctic presence is intended to improve the country’s ability to respond to threats against Norway and NATO, while Russia has previously rejected claims that it poses a threat to the alliance.

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Italian NATO Fighter Shoots Down Drone Over Latvia

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An Italian Eurofighter jet operating under NATO command shot down a drone after it entered Latvian airspace on Friday, according to NATO and Latvian authorities. The drone’s origin remains unknown, with Latvian National Guard troops searching a wooded area near Rugaji, about 35 km from the Russian border, for possible debris from the aircraft.

Two Italian Eurofighters scrambled from Lithuania, while two Turkish F-16s were also deployed from Estonia after the drone was detected. NATO said one of the Italian jets identified and destroyed the drone, adding that an investigation was underway and that it remained in close contact with Latvian authorities. The incident comes amid growing concerns over drone incursions into the airspace of NATO’s Baltic members, which border Russia and are close to the war in Ukraine.

A Romanian F-16 shot down a Ukrainian drone over Estonia in May, while a French Rafale destroyed another drone in Latvia in June. Finland also temporarily restricted some aviation and maritime activity in the eastern Gulf of Finland as a precaution.

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