By Tirana Times November 5, 2025
Albania’s draft budget for 2026 marks a significant milestone in the country’s defense modernization and strategic alignment with NATO objectives. The government has announced a €100 million increase in defense funding, raising total expenditures to €589 million or approximately 2.1% of GDP surpassing the Alliance’s current benchmark and signaling a firm commitment to long-term security investment.
According to the government’s accompanying budget statement, the 2026–2028 defense priorities will focus on modernizing Albania’s military capabilities, equipping land forces with NATO-interoperable systems, and upgrading the infrastructure and technological platforms of the Armed Forces. Beyond national defense, the plan also underscores the country’s growing participation in NATO operations and international missions, as well as its enhanced readiness for civil emergencies.
The move comes in the wake of the NATO Summit in The Hague on June 25, where member states reaffirmed their collective pledge to gradually raise defense spending toward 5% of GDP over the next decade a substantial increase from the long-standing 2% target.
Defense Minister Pirro Vengu has confirmed that Albania is drafting a detailed roadmap to progressively reach the 5% spending target. “We are determined that these investments will not merely serve the purchase of weaponry, but become an engine for domestic economic development,” Vengu said, highlighting the dual objective of enhancing both national security and industrial capacity. The ministry’s plan envisions channeling part of the funds toward dual-use infrastructure projects that serve both military and civilian purposes in order to create what Vengu described as “a synergy between defense and economic growth.”
Albania’s defense strategy increasingly relies on international partnerships and technology transfers from major industry players. Among 25 foreign investors expressing interest in the country’s defense sector, key partners include U.S. and Israeli companies. A landmark agreement was signed in April 2025 with Elbit Systems Ltd., one of Israel’s leading defense firms. The project centered on the former copper plant in Rubik will transform the site into a regional hub for assembling drones and manufacturing both light and heavy weaponry for the Albanian Armed Forces.
Meanwhile, collaboration with Lockheed Martin continues to advance, supporting Albania’s modernization efforts. Although delivery of the long-awaited Javelin anti-tank systems ordered in 2022 is still pending, discussions with the American defense giant have expanded toward joint technology development and enhanced operational capabilities.
In another notable development, Albania will soon deploy its first air defense radar systems, procured from the French company Thales Group. Within 14 months, the Ground Master 400 Alpha (GM400α) radar will be operational, providing advanced airspace monitoring and situational awareness a critical asset for the country’s sovereignty and integration into NATO’s collective defense architecture.
The 2026 defense budget signals a decisive turn in Albania’s national security posture, elevating its profile within NATO while also creating new opportunities for industrial cooperation and foreign investment. By aligning its defense spending trajectory with the Alliance’s long-term targets and partnering with top global defense companies, Albania positions itself not only as a reliable ally but also as an emerging player in the regional defense economy. If the planned investments are implemented effectively, Albania could become a model of small-state adaptation within NATO, balancing deterrence needs with economic pragmatism and proving that collective defense can also serve as a driver of national development.
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