Estonian Defense Budget: Preserving Deployments Amidst Cuts

UNCLAS SECTION 01 OF 02 TALLINN 000327 SIPDIS E.O. 12958: N/A TAGS: PREL MARR MASS ECON EN SUBJECT: Estonian Defense Budget: Preserving Deployments Amidst Cuts REF: TALLINN 350 ¶1. SUMMARY. Estonia's 2010 defense budget falls just short of its NATO commitment to spend two percent on defense, coming in at 1.86 percent of GDP. While the budget has fallen in absolute terms, defense spending remains comparable to 2009 as a percentage of GDP. The budget preserves spending on international deployments, Baltic Air Policing, renovation of the Amari Airfield, and recruitment. Estonia is also committed to maintaining its host country support for the Baltic Defense College and Cyber Center. Cuts were instead made in operations, management, personnel, and procurement. In the near term, the economic crisis has solved recruiting challenges, but these will probably resurface when the economy recovers. Post will endeavor to use all available means, FMF, IMET and other resources such as Estonia's relationship with the Maryland National Guard, to help ease the pain caused by the cuts. END SUMMARY. ¶2. Estonia will not meet its NATO commitment of two percent of GDP for its 2010 defense budget. The current projection is a defense budget of approximately 3.9 billion EEK (USD 374 million) or 1.86 percent of GDP. This is less than a three percent fall from the 2009 budget, which was 1.88 percent of GDP. The economic crisis caused larger cuts, of approximately 12 percent, between 2008 and ¶2009. Even though the 2008 defense budget was larger, at 4.5 billion EEK, it represented only 1.85 percent of GDP at the time. International Deployments Preserved, Procurement Delayed -------------- -------------- -------------- ¶3. In the budget debate there was broad consensus within the GOE to avoid cutting expenditures for Estonia's international deployments, air policing and infrastructure development at Amari Air Base (which Estonia has offered for NATO Air Policing),and recruitment for the Estonian Defense Forces (EDF). The GOE will also maintain host-nation support to both the Baltic Defense College and NATO's Cooperative Cyber Defense Center of Excellence. The MoD made cuts primarily in the areas of operations, management and personnel expenditures, and some procurement and infrastructure projects were postponed. However, MoD made cuts in such a way that the primary objectives of the 2009-2018 Defense Development Plan would still be achievable within or close to each items' projected timeline. ¶4. Overall, the defense establishment has a positive outlook, and views the economic crisis as an opportunity to implement reforms that will make Estonia's defense structure more efficient and effective. The EDF will continue to conduct planning for new acquisitions and development of enhanced capabilities and seek to put the following plans back on track as the financial situation allows: a mobile short-to-medium range air defense capability, the fielding of a high readiness infantry brigade, development of a mechanized battalion, and continued enhancement of anti-tank capabilities. The 10-year development plan also incorporates development of a multi-role helicopter program for the EDF and a fast patrol boat capability for the Navy. Economic Crisis Boosts Recruitment -------------- -- ¶5. One silver lining to the economic crisis has been the boost to recruitment. Prior to the economic crisis, the EDF had difficulty meeting its recruitment goals, when, according to Land Forces Commander COL Indrek Sirel, the starting salary at McDonald's was comparable to a new recruit's salary. Now there is a long waiting list, and Sirel's only concern is keeping the funds flowing that allow the EDF to move people from the waiting list into uniform in a timely fashion. However, even during the economic crisis, Sirel noted that the EDF faces challenges in keeping some critical combat service support positions filled, most notably medics. He anticipates that this task will only become more difficult as the economy recovers. TALLINN 00000327 002 OF 002 ¶6. The rosy recruitment picture aside, the EDF maintains its commitment to a mixed force structure of conscripts and regular soldiers. Sirel considers conscription to be one of the best methods for recruitment into the regular armed forces. As part of the 10-year development plan, the MoD foresees an annual increase of 125 regular members for the EDF with a total force of 4,000 regulars by 2018 (up from 3,300 now). At that time, a reserve force of 25,000 will also complement the regular EDF. The development plan also incorporates significant improvements in the organization of the Defense League, a volunteer, paramilitary force whose chief aim is territorial defense but has served as the basis for Estonia's recent deployments in Kosovo. The Defense League currently consists of approximately 10,000 members, plus an additional 9,000 members in women's and youth auxiliary units. Professional development of the EDF and Defense League Officer and Non-commissioned Officer Corps are other key elements of the 10-year development plan that the MoD has committed to maintaining amid the current round of cuts. ¶7. Comment: Post believes FMF and IMET funds can play a critical role in helping this key NATO ally keep its long-term development plan on track while still serving in international peace and security missions. For its size, Estonia has been a major contributor to international operations, and GOE officials routinely ask for more chances for their military to serve alongside U.S. forces. The Estonian military deploys without caveats, and receives high-marks from its partners. In this regard, Post will request a significant increase in FMF and IMET funding for Estonia. Post further believes that other training opportunities, such as those presented by the Defense League's relationship with the Maryland National Guard, can play an important role in helping Estonia achieve its military development goals. Every Estonian soldier deployed means one less American downrange, and as Estonians want to keep working with our military, investments in the EDF means American lives saved. DECKER