Lithuania’s rising defence budget exposes procurement system weaknesses

Lithuania’s defence procurement system is failing to keep pace with the growing needs of the armed forces, while the Ministry of National Defence says it is already implementing changes to speed up purchases, LRT reported.

An audit by the State Control Office found that the share of unsuccessful arms and military equipment procurements rose from 24 percent in 2023 to 59 percent in 2025. In 42 percent of the procurements reviewed, coordination with ministry departments and advisory groups took between 30 and 374 days.

Auditors said both internal and external factors were preventing the system from meeting the military’s needs on time. Internal problems included changing procurement priorities, outdated capability development plans, lengthy coordination procedures, a shortage of qualified specialists, insufficient monitoring of procurement efficiency and fragmented management of major arms projects.

External factors included rising demand for arms on international markets, limited production capacity among manufacturers and long manufacturing and delivery times for weapons and military equipment.

Between 2023 and 2025, contracts worth 8.7 billion euros were signed for arms and military equipment. Funding for this area rose from 14 percent to 40 percent of total expenditure in the national defence system.

The auditors found no significant systemic violations in procurement, but identified major or moderate discrepancies in 38 percent of the routine arms purchases they examined.

Ministry says funding is no longer the main constraint

The Ministry of National Defence told news agency ELTA that long procurement and delivery times were primarily caused by limited production capacity in the defence industry and large order backlogs.

“Because of increased demand and the rapid strengthening of Western countries’ defences, the capacities of many manufacturers are booked several years in advance,” the ministry said.

Public procurement procedures, including supplier appeals against procurement results, can also extend the process, according to the ministry.

“As Lithuania’s defence funding increases, the main limiting factor is no longer funding, but the capacity of the defence industry and supply chains. At the same time, there remains a need to further improve procurement processes so that available funding is converted into real capabilities for the Lithuanian armed forces as quickly as possible,” the ministry told ELTA.

The ministry confirmed that schedules for some projects had been delayed because of increased global demand for defence products, but did not identify the projects or specify the length of the delays.

Expert says system was not designed for current scale

Giedrimas Jeglinskas, a senior expert at the Royal United Services Institute, a United Kingdom defence and security analysis centre, said the problem was complex. He said procurement was being constrained both by manufacturers’ capacity and by Lithuania’s own procurement system.

“As a country, we demonstrated our political will by allocating the resources requested by the armed forces and the system. On the other hand, when allocating or discussing these amounts, we knew very well that absorbing them would be extremely difficult. There is nothing new or surprising about procurements being slow,” Jeglinskas told ELTA.

He said the defence industries of Europe and the United States had also not adapted to expanding at the pace of national defence budgets. However, he stressed that Lithuania’s system also needed to change.

Jeglinskas, a former deputy minister, helped create the current procurement system about a decade ago. He said it had been designed to ensure transparency and prevent procurement-related scandals, but that current conditions required a different model.