Executive summary[1]
Defence has become a public policy area of the highest priority in Europe. As the war in Ukraine rages on and the second Trump administration encourages Europeans to take ownership of conventional defence within NATO, the European Union (EU) has launched a flurry of initiatives in recent years to bolster Europe’s military capabilities and revitalise Europe’s defence industrial and technological base. What does this mean for Spain?
Spain is often singled out as a laggard when it comes to defence spending. To be sure, input metrics – such as spending – provide an incomplete picture about an ally’s contribution to collective security. And Spain’s ongoing commitment to NATO and EU missions paints a somewhat more positive picture. Moreover, after years of under-investment, Spain announced a €10.4 billion increase in defence expenditure in 2025, aiming to meet NATO’s 2% GDP target. However, questions remain about the sustainability and focus of this investment, particularly as future NATO targets may increase to 3% or 5% of GDP. As NATO and the EU continue to roll out various benchmarks and initiatives relating to spending, capability development and industrial production, Spain must either up its game or risk missing the boat when it comes to defence modernisation.
In this context, Spain faces both an opportunity and a risk: it must assert itself within evolving EU defence frameworks or risk exclusion from key capability-building initiatives. Spain must carefully align its national defence strategy with the EU’s Readiness 2030 initiatives to maintain its role as a key player in EU defence and industrial cooperation. Strategic alignment with EU defence objectives is essential, particularly in the context of uncertain transatlantic relations and evolving security threats. Without a coordinated national effort, Spain risks marginalisation in major EU defence programmes, which would hinder its industrial competitiveness and diminish its influence in European integration.
To play a central role in future EU flagship defence programmes, Spain’s defence innovation ecosystem will need reform. It continues to be challenged by a fragmented, silo-based approach. Despite recent strategic plans promoting regional defence hubs and dual-use technology development, integration with civilian innovation sectors remains limited. A cultural shift toward open innovation and whole-of-society engagement is critical in order to enhance national competitiveness and ensure access to EU funding mechanisms.
This paper has two central aims: first, to map the strategic, technological and regulatory changes shaping EU defence; and second, to assess their implications for Spain’s defence industry. Structured in three parts, the report examines the geopolitical context, emerging industrial trends and Spain’s positioning within EU frameworks. It concludes with recommendations for how Spain can enhance its role in European defence and fully engage in collaborative industrial initiatives.
[1] This Policy Paper draws on the input received during two closed-door seminars as well as extensive consultations with relevant stakeholders. The two closed-door seminars were organised in Brussels and Madrid during the first half of 2025, and included participation from various officials and experts from the Spanish Government, the Spanish private sector, the EU and NATO. The authors thank the participants for their input and feedback on previous drafts, and remain solely responsible for the contents of this Policy Brief.
Image: Spanish Army soldiers boarding a helicopter during a field exercise. Photo: Ejército de Tierra español (CC BY-NC-SA 2.0)
