BERLIN — One factor rarely mentioned in the debate over Greece's debt is Athens' huge military expenditure. Indeed, in proportional terms, the Greek military is Europe's most costly.
But it turns out that a notable portion of the responsibility for the spending equipment falls on Germany, where arms manufacturers are profiting on Greek purchases of military weaponry it clearly cannot afford.
To avoid the state defaulting, Greece is supposed to cut public spending, which should include reduction of the wages of civil servants, pensions and social security benefits. But, at the same time, more and more is being spent on the military. A communique last week suggested that the Greeks are considering the purchase and maintenance of new long-range missiles to support the Russian anti-aircraft system S-300.
The sole focus in this case is the replacement of existing missiles, says Greek Defense Minister Panos Kammenos, who noted that some of the systems in use were becoming obsolete. But precisely what sums of money were to be invested has not been disclosed as of yet.
Though a NATO member, Greece has owned the Russian anti-aircraft system S-300 since the early 1990s on top of their US Patriot system. According to experts, these systems have to be serviced regularly and replacement parts must be purchased.
The price of an S-300 guided missile is supposed to be below that of a Patriot guided missile; experts estimate it to be around $1 million per missile.
Although Greece had to reduce its expenditure on new military acquisitions in light of the imposed austerity measures, the maintenance costs of the arms build-up are now accruing. In 2014, for example, Greece ordered tank ammunition worth 52 million euros from the Rheinmetall cooperation. That is the price for 12,000 rounds of 120-mm caliber ammunition for their Leopard 2 tanks.
Krauss-Maffei Wegmann Leopard tanks in Iraq — Photo: Dino246
The tanks had been purchased in 2009, accounting for a major windfall for the German armament company Krauss-Maffei Wegmann.
But the purchase of the matching ammunition had been delayed for years. The Greek forces now command 353 Leopard 2 tanks and, with that, have more modern tanks than the German Federal Armed Forces.
Out of proportion
Greece's thirst for reinforcing its military comes from its historical standoff, a kind of Cold War, with its neighbor Turkey. With approximately 130,000 soldiers serving a country of 11 million inhabitants Greece has by far the largest army per capita in all of Europe. The total number of Greek tanks is around 1,600, many of these being old Leopard models.
To fully comprehend the dimensions of the Greek arms build-up a comparison is needed: Germany would have to hire an additional 180,000 soldiers and buy an extra 10,000 tanks to reach the same level of armament in proportional terms.
Greece’s high armament expenditure have undoubtedly contributed to the quasi-bankruptcy of the state. If seen in relation to Greece’s GDP, Athens has been spending more on its military than any other European state for several decades.
NATO estimates that Greece has spent 3.1% of its GDP on its military, as compared to, for example, Austria which spends 0.8%.
In the last decade alone Greece imported military items worth $11 billion. Taking this into account, Greece was the world’s fifth largest arms importer between 2005 and 2009. This circumstance was of particular benefit to German companies.
Germany, together with the US and France, is the principal supplier. Greece obtains 31% of its arms from German companies and is the second largest customer when it comes to buying armaments from the holdings of the German Federal Armed Forces. ThyssenKrupp was responsible for transforming the Greek shipyard, Hellenic Shipyards, into a modern producer of U-Boats in the Mediterranean.
A deal done 15 years ago to provide seven submarines is going to give Hellenic Shipyards a profit of 2.84 billion euros, and includes producing four new 214 Class submarines and modernizing three aging submarines.