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Cablegate: Estonian Defense Budget: Preserving Deployments Amidst Cuts

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DE RUEHTL #0327/01 3140950
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FM AMEMBASSY TALLINN
TO RUEHC/SECSTATE WASHDC 0212
INFO EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 01 OF 02 TALLINN 000327

SIPDIS

E.O. 12958: N/A
TAGS: PREL MARR MASS ECON EN
SUBJECT: Estonian Defense Budget: Preserving Deployments Amidst Cuts

REF: TALLINN 350

1. SUMMARY. Estonia's 2010 defense budget falls just short of its
NATO commitment to spend two percent on defense, coming in at 1.86
percent of GDP. While the budget has fallen in absolute terms,
defense spending remains comparable to 2009 as a percentage of GDP.
The budget preserves spending on international deployments, Baltic
Air Policing, renovation of the Amari Airfield, and recruitment.
Estonia is also committed to maintaining its host country support
for the Baltic Defense College and Cyber Center. Cuts were instead
made in operations, management, personnel, and procurement. In the
near term, the economic crisis has solved recruiting challenges,
but these will probably resurface when the economy recovers. Post
will endeavor to use all available means, FMF, IMET and other
resources such as Estonia's relationship with the Maryland National
Guard, to help ease the pain caused by the cuts. END SUMMARY.


2. Estonia will not meet its NATO commitment of two percent of GDP
for its 2010 defense budget. The current projection is a defense
budget of approximately 3.9 billion EEK (USD 374 million) or 1.86
percent of GDP. This is less than a three percent fall from the
2009 budget, which was 1.88 percent of GDP. The economic crisis
caused larger cuts, of approximately 12 percent, between 2008 and
2009. Even though the 2008 defense budget was larger, at 4.5
billion EEK, it represented only 1.85 percent of GDP at the time.

International Deployments Preserved, Procurement Delayed

--------------------------------------------- ----------------------
-------------

3. In the budget debate there was broad consensus within the GOE
to avoid cutting expenditures for Estonia's international
deployments, air policing and infrastructure development at Amari
Air Base (which Estonia has offered for NATO Air Policing), and
recruitment for the Estonian Defense Forces (EDF). The GOE will
also maintain host-nation support to both the Baltic Defense
College and NATO's Cooperative Cyber Defense Center of Excellence.
The MoD made cuts primarily in the areas of operations, management
and personnel expenditures, and some procurement and infrastructure
projects were postponed. However, MoD made cuts in such a way that
the primary objectives of the 2009-2018 Defense Development Plan
would still be achievable within or close to each items' projected
timeline.

4. Overall, the defense establishment has a positive outlook, and
views the economic crisis as an opportunity to implement reforms
that will make Estonia's defense structure more efficient and
effective. The EDF will continue to conduct planning for new
acquisitions and development of enhanced capabilities and seek to
put the following plans back on track as the financial situation
allows: a mobile short-to-medium range air defense capability, the
fielding of a high readiness infantry brigade, development of a
mechanized battalion, and continued enhancement of anti-tank
capabilities. The 10-year development plan also incorporates
development of a multi-role helicopter program for the EDF and a
fast patrol boat capability for the Navy.

Economic Crisis Boosts Recruitment

--------------------------------------------- --

5. One silver lining to the economic crisis has been the boost to
recruitment. Prior to the economic crisis, the EDF had difficulty
meeting its recruitment goals, when, according to Land Forces
Commander COL Indrek Sirel, the starting salary at McDonald's was
comparable to a new recruit's salary. Now there is a long waiting
list, and Sirel's only concern is keeping the funds flowing that
allow the EDF to move people from the waiting list into uniform in
a timely fashion. However, even during the economic crisis, Sirel
noted that the EDF faces challenges in keeping some critical combat
service support positions filled, most notably medics. He
anticipates that this task will only become more difficult as the
economy recovers.

TALLINN 00000327 002 OF 002


6. The rosy recruitment picture aside, the EDF maintains its
commitment to a mixed force structure of conscripts and regular
soldiers. Sirel considers conscription to be one of the best
methods for recruitment into the regular armed forces. As part of
the 10-year development plan, the MoD foresees an annual increase
of 125 regular members for the EDF with a total force of 4,000
regulars by 2018 (up from 3,300 now). At that time, a reserve
force of 25,000 will also complement the regular EDF. The
development plan also incorporates significant improvements in the
organization of the Defense League, a volunteer, paramilitary force
whose chief aim is territorial defense but has served as the basis
for Estonia's recent deployments in Kosovo. The Defense League
currently consists of approximately 10,000 members, plus an
additional 9,000 members in women's and youth auxiliary units.
Professional development of the EDF and Defense League Officer and
Non-commissioned Officer Corps are other key elements of the
10-year development plan that the MoD has committed to maintaining
amid the current round of cuts.

7. Comment: Post believes FMF and IMET funds can play a critical
role in helping this key NATO ally keep its long-term development
plan on track while still serving in international peace and
security missions. For its size, Estonia has been a major
contributor to international operations, and GOE officials
routinely ask for more chances for their military to serve
alongside U.S. forces. The Estonian military deploys without
caveats, and receives high-marks from its partners. In this
regard, Post will request a significant increase in FMF and IMET
funding for Estonia. Post further believes that other training
opportunities, such as those presented by the Defense League's
relationship with the Maryland National Guard, can play an
important role in helping Estonia achieve its military development
goals. Every Estonian soldier deployed means one less American
downrange, and as Estonians want to keep working with our military,
investments in the EDF means American lives saved.
DECKER

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