The Defence Ministry’s budget will rise to 894.7 million euros in 2027 from 628 million euros this year, with 430.15 million euros earmarked for the defence shield, Defence Minister Vasilis Palmas told the House Finance Committee on Friday. Primary expenditure is up by 266.6 million euros, or about 42.5 per cent.
The allocation includes 247.82 million euros for the maintenance and operation of the National Guard, about 203 million euros for the Cyprus Army and 13.58 million euros for the ministry’s own budget chapter.
Total defence spending, including funding from the EU’s Security Action for Europe (SAFE) mechanism, is estimated at about 2.2 per cent of GDP in 2027 and 2.11 per cent in 2028, the ministry’s deputy director general, Stelios Kountouris, told the committee. Spending on the defence shield alone is projected to rise from 0.73 per cent of GDP in 2026 to 1.06 per cent in 2027, before settling at around 1 per cent in 2028.
Kountouris said an annual funding increase of 100 million euros could cover a large part of the country’s defence needs. Palmas noted that GDP growth affects the percentage even when appropriations rise. He added that some defence planning and operational capability issues would be presented to the House Defence Committee behind closed doors.
Equipment and cooperation
Presenting the budget, Palmas referred to the contracts signed through SAFE. He said the National Guard’s deterrence and military capabilities were being strengthened through equipment plans funded by the state budget and SAFE. He pointed to bilateral defence cooperation programmes with 20 countries, the work of the Joint Rescue Coordination Centre (JRCC), and an agreement with Israel for personal equipment for active personnel and reservists.
Defence industry and research
Palmas named the development of a Cypriot defence industry as a priority, saying it widens the National Guard’s options for buying technological equipment and contributes to the economy. The benefit was twofold, he said: Cypriot companies are developing dual-use products that can be built into the National Guard’s procurement programmes and also serve the public and wider public sector.
The budget sets aside 500,000 euros to draw up a National Defence Industry Development Plan and promote related programmes. A further 2.5 million euros is earmarked for taking part in European Defence Fund programmes and other research and innovation activities. Of that, 2.22 million euros goes to projects already under way and 280,000 euros to new ones, including the ‘ATHENA’ and ‘ODYSSEAS’ actions.
Personnel and reservists
On transfers, Palmas said requests from personnel who have served four years outside their home district would be viewed favourably, depending on operational needs. A ministry representative said a contract was in place for more than 100 bus routes to transport soldiers and contract soldiers.
The minister acknowledged that interest in voluntary enlistment among women had been low and that participation had fallen short of the ministry’s expectations. He stressed the importance of the reserve and the Home Guard to the National Guard’s operations. “Without them, we can’t do anything,” he said.
National Guard deputy chief Neofytos Pachoulides said there was a surplus of reservists. He acknowledged that some units had limited training time, which is being addressed in a plan to be submitted to the Defence Ministry at a later date.
Doctors at the military hospital
Palmas said ten general and specialist doctors had been recruited to the military hospital at the A10 pay scale, with the rank of captain. He added that attracting medical staff had become harder since the General Health System (GHS) was introduced. The National Guard General Staff told the committee that nurses would also be hired to complete the plan. The committee also heard that these professionals could work privately outside their National Guard hours.
Tseri firing range to move
Palmas confirmed plans to relocate the Tseri firing range. He said pending issues over church land left the timetable open. The plans include limiting firing at the existing range to 300 metres, from 600 metres.
The Kalo Chorio firing range will stay where it is. According to Pachoulides, a permanent guard post with surveillance cameras operates there, and activity at the range has been significantly reduced.
