Expanded NATO Will Shoot Billions To US Defense Contractors
Two more Nordic countries are joining the North Atlantic Treaty Organization. The real winners are American defense companies.
Finland and Sweden officially applied last week to join NATO. If admitted they would join their Nordic neighbors in the alliance, and open up a big new market for American defense contractors.
It would be a big win for Raytheon (RTN), Lockheed Martin LMT +2.1% (LMT) and Northrop Grumman NOC +3% (NOC).
The Russian invasion of Ukraine was a shockwave for Europe. For much of the last eight decades democracies on the continent have benefitted from a peace dividend. Elected leaders spent lavishly on social safety nets while largely ignoring that the world remains a dangerous place. The creation of the European Union expedited pacifism. Images of the destruction of Ukraine changed everything.
Before the Feb. 24 war in Ukraine support for NATO membership in Finland remained in the 20%-30% range. According to a report from the Associated Press, 70% of Finnish now want to join.
Sauli Niinistö, President of Finland summed up the shift succinctly.
Prior to the war Finland was in control of its political allegiances, he says. While the country contributed to NATO’s air policing initiatives in the North Sea, Finland also shared an 830-mile border with Russia, resulting in many economic benefits. The invasion removed nonalignment as an option. Finland was either with Russia and defenseless, or aligned with NATO.
SAUCE: https://www.forbes.com/sites/jonmarkman/2022/05/23/expanded-nato-will-shoot-billions-to-us-defense-contractors/?sh=234041b83189