Italy: Defense-investment hikes appear to taper off

Tom Kington

Rome: Italy’s new right-wing government is set to keep the country’s defense-procurement spending on an even keel in 2023 without pushing for the big hikes seen in recent years, an analyst has told Defense News.

Defense spending in the first budget prepared by new prime minister Giorgia Meloni’s government includes a procurement outlay of around €8.25 billion ($8.7 billion) for 2023, on par or slightly higher than this year, said Francesco Vignarca, co-founder of Mil€x, a news site analyzing Italian military expenditure.

The total contains €6.1 billion in procurement spending from the defense ministry and another €2.15 billion top-up from Italy’s industry ministry, said Vignarca, who combed through budget numbers which are being debated in parliament now and must be signed off by year’s end.

Last year, Italy spent €7.85 billion on procurement thanks to combined funding from the two ministries according to official documents. That is apparently less than Vignarca’s estimate for 2023, but he said that was due to calculating methods.

“We add in loan repayments on previous procurements while the government doesn’t,” he said. “Numbers may also be revised and we don’t have all the details, but it appears that procurement spending next year will not change greatly compared to the rises seen in previous years,” he said.

“2023 procurement spending looks like a stationary trend, albeit staying at the current highest historical peak,” he added.

This year’s procurement outlay of €7.85 billion euros was up from €6.76 billion in 2021, which in turn was up from €5.45 billion in 2020.

Giorgia Meloni led a right-wing coalition to electoral victory in Italy in September which committed to pushing up spending to reach the target of 2% of GDP set down by NATO.

“I predict Italian spending in 2023 will be just less than 1.5% of GDP,” said Vignarca.

A big-ticket item in this year’s spending was the sixth-generation Tempest fighter teaming Italy with the U.K., which received €220 million in funding.

Italy will now be looking to maintain funding after it signed up on Friday to the Global Combat Air Programme effort, which morphs Tempest into a tri-nation deal with Japan and the U.K.

The agreement brings together BAE Systems, Japan’s Mitsubishi Heavy Industries and Italy’s Leonardo, which said the Italian team would also include Italian universities and firms including Avio Aero, MBDA Italia electronic-warfare firm Elettronica.

In September, Italian Air Force chief Gen. Luca Goretti told Defense News he had been invited by his Japanese counterpart to Japan to discuss teaming on sixth-generation fighter technology.

Goretti has also predicted that France, Spain and Germany will combine efforts with Britain, Italy and now Japan on a joint fighter program in the future.