Malta’s Defence Spending: Among the Lowest in Europe

Successive Maltese governments, led by the Labour Party or the Nationalist Party, have consistently prioritised investment in education, health, and social services. Defence, by contrast, has remained a marginal item on the national budget. According to 2023 Eurostat data, Malta allocates just 0.4% of its GDP to defence — one of the lowest rates in Europe.

Even lower than Malta is Ireland, which spends only 0.2% of its GDP on defence. Both countries maintain a policy stance favouring neutrality and non-alignment, directing national resources toward internal development and social welfare. Their defence spending is a fraction of the European Union average, which stood at 1.3% of GDP in 2023 — amounting to €227 billion across the bloc.

Latvia and Estonia are at the opposite end of the spectrum. Latvia tops the list with 3.1% of GDP dedicated to defence, followed closely by Estonia at 2.7%. These countries, once part of the Soviet Union, view Russian aggression as a tangible threat. The 2022 invasion of Ukraine has intensified their defence efforts, rooted in historical experiences and geographical vulnerability.

The current geopolitical climate in Europe is shifting. U.S. President Donald Trump has reiterated threats to withdraw American support for NATO, particularly for member states that fail to meet spending targets. In response, European Commission President Ursula von der Leyen has proposed a dramatic increase in military expenditure, calling on EU member states to invest up to 5% of their GDP in defence — a move that would fundamentally reshape public finance across the continent.

For Malta, such a transformation would be seismic. Shifting from 0.4% to 5% of GDP in defence spending would require massive reallocation of national funds. Without an increase in GDP or external financing, this would likely entail significant cuts to core sectors such as education, health, and social services—the very pillars on which Maltese governance has historically rested.

This dramatic reorientation is being politically justified at the EU level by the rhetoric of an imminent Russian threat. Yet for Malta, a small, neutral state in the central Mediterranean with no direct military border with Russia, the strategic rationale behind such an increase is far from clear.

The graph published by Eurostat provides visual confirmation of Malta’s position within the broader European landscape: a country deeply invested in civil well-being and one of the few resisting the continent’s new militarisation narrative.