Hensoldt boss urges Germany to spend 3% of GDP on defence

ZURICH (Reuters) - Germany should commit to increasing its defence spending to a sum equivalent to 3% of gross domestic product, the chief executive officer of defence electronics specialist Hensoldt was quoted as saying on Tuesday.

In an interview with the Neue Zuercher Zeitung, Oliver Doerre said Germany needed more tanks, more aircraft, more ships and improvements to existing weaponry to help build up a deterrent to threats emanating from countries like Russia.

Doerre told the Swiss newspaper he expected the German government, which holds a 25.1% stake in Hensoldt, to maintain defence spending at a minimum of 2% of GDP.

"But I also believe that we need to move towards 3 to 3.5% of GDP," he said. "At Christmas time you can make a wish: Germany should anchor 3% of GDP for defence in its constitution. This should then apply for at least ten years."

"In Germany, the assumption is that Russia will have the capacity to attack NATO in 2028 or 2029. We need our own deterrence capability in Europe," Doerre said.

Hensoldt, in which Italy's partly state-owned Leonardo also holds a 22.8% stake, produces radar and high-precision optics used in aircraft, ships and tanks.

Turning to the European Sky Shield Initiative (ESSI) air defence scheme, Doerre said Hensoldt had contracts with three participating countries, is concluding contracts with two more and is in talks with three other countries, without naming them.



Asked about consolidation in the industry, Doerre said 2025 would be a year of partnerships, in which the firm would first enter discussions with companies. However, he noted small or medium-sized acquisitions were possible.

He pointed to the company's cooperation with Leonardo on the Eurofighter jet, adding: "Perhaps tanks will also be added, as Leonardo cooperates with Rheinmetall (ETR:RHMG ) in this area."

Source: Investing.com