GENOA (Reuters) -A potential increase in military spending could add to growth estimates released last month by Italian defence group Leonardo, Chief Executive Alessandro Profumo said on Monday.
“We already have a very important growth plan … everything that arrives will come on top (of current estimates)”, Profumo said when asked how a potential increase in military spending could change the group’s estimates.
Speaking at the inauguration of the group’s cyber security academy in Genoa, northern Italy, Profumo said the impact of a hike in defence spending would depend on what kind of defence programmes would get additional money.
Leonardo said in March its free cash flow would more than double this year compared with 2021.
Profumo said he expected NATO countries to ramp up military spending to reach 2% of gross domestic product (GDP) over time.
The fact that the European Union has a coordinated plan on how to spend money for defence is even more important than an expected increase in NATO members’ spending, he added.
Italy will only hit the NATO goal of spending 2% of GDP on defence in 2028, Prime Minister Mario Draghi said last week, confirming it will miss an original target of 2024 after opposition from within his ruling coalition.
The government currently earmarks around 1.4% of economic output for military spending and would have had to increase its defence budget by 12 billion euros over the next two years to reach a goal established by members of the Atlantic alliance in 2014.
On Monday Leonardo presented its cyber security training centre for security professionals who work in the defence sector, in the public administrations, critical infrastructures and businesses.
“The war (in Ukraine) has increased cyber threats and has also made them more evident,” said Leonardo’s head of the cyber security division Tommaso Profeta, speaking about Italy.
The government last month ordered public authorities to replace Russia-based Kaspersky Lab antivirus software to prevent any disruption of services due to the ongoing Ukrainian conflict.
“Leonardo is ready to integrate its cyber security services and products with the ones of international groups as a way to offer a guarantee to Italian institutions and businesses,” Profeta said.
(Reporting by Francesca Landini; Editing by David Holmes, Kirsten Donovan)