Lithuania is cutting its defense budget 20 percent, to $431 million. Russia recently announced it would cut its military spending 15 percent. Most East European nations have been hard hit by the current recession, and many of them are expected to cut their defense spending to a similar extent. Most of the cuts will be in procurement of new weapons and equipment. Layoffs are a less attractive option, considering the rising civilian unemployment.
Russia has already announced that it will resume rebuilding its decrepit armed forces in two years. Like most East European nations, there was a big drop in military spending after the Soviet Union collapsed in 1991. The Soviet Union was the major producer of weapons for the nations of Eastern Europe, and in the early 1990s, that production basically stopped. Many of the existing weapons were sold off as the armed forces were much reduced in size. For over a decade, no new equipment was bought, and much of what already existed was not well maintained. There's a huge buildup of deferred procurement, especially since a lot of the older equipment and weapons have not only gotten older, but have become obsolete because of new technology. Russia has fallen behind the other East European nations in this technology race. The non-Russian nations have been largely more successful in reforming their communist era economies, and most have joined NATO, and obtained help in updating their weapons. But Russia is still the largest military power in Eastern Europe, and has the biggest need to rebuild. And rebuild it will.