Good morning,

This is your Thursday morning edition of The Intel Brief.

Reporting Period: 2-5 December 2024

Bottom-Line Up Front:

Russian President Putin Approves Massive 2025 Defense Budget

Summary
Russian President Vladimir Putin approved a $126 billion allocation to defense spending for FY2025, approximately 32.5% of the Kremlin’s budget. The massive spending increase indicates Putin’s desire to continue to the war. Russia is very likely to continue large-scale ground operations in eastern Ukraine and Kursk in addition to drone and missile strikes on critical infrastructure. In the event of a peace settlement, Russia is still likely to have high defense spending in order to rebuild its military.

Findings

• Increased Spending: This is a 28% increase to the 2024 defense budget

• Russian Parliament: Russia’s State Duma and Federation Council (both which make up Parliament) rubberstamped the proposal

• Battlefield Losses: In November, Russia suffered 46,000 casualties and incurred $3 billion in losses of military equipment during combat operations

• Russian Operations: Coincides with ongoing Russian drone and missile strikes across Ukraine

Why This Matters
Russia’s substantial defense budget for 2025, in addition to large-scale offensive operations in Kursk and eastern Ukraine, indicate Putin’s intent to carry on fighting the war. Previous estimates suggested Russia’s defense spending would decrease due to Russian economic issues such as high-wages, high-inflation, and a shrinking workforce.

There has been speculation that Russia would come to the negotiating table once Donald Trump is inaugurated. The Kremlin previously stated that Russia would attend such negotiations, but would only agree to terms outlined by Putin in June 2024 (which include Ukraine losing territory and no NATO or EU membership for Kyiv).

It is likely that Russia will continue its offensive operations, which include drone and missile strikes on Kyiv, as it entertains peace negotiations. Putin is likely to use negotiations as a method of opening further bilateral diplomatic channels.

Sources: CNN, NBC News, The Kyiv Independent, CBS News, Euro News

NATO Nations Deploying Assets To Poland Amid Growing Tensions

Summary
Norway will deploy F-35 fighter jets and advanced air defense systems to Poland in early 2025. Similarly, beginning in January, Germany is set to station PATRIOT systems in Poland. These deployments aim to bolster NATO’s eastern flank as Russia intensifies large-scale strikes on Ukraine in support of ongoing ground operations. NATO also grows concerned of increased Russian and Chinese sabotage in Europe.

Findings

• German Chancellor Scholz made a surprise visit to President Zelenskyy in Kyiv; committed an additional $680 million of military aid

• Germany’s PATRIOT systems will operate near Polish logistics hubs supporting Ukraine

• Leaked German contingency documents revealed Poland’s central role for the deployment of 800,000 NATO personnel

• Recent undersea cable sabotage indicates growing vulnerabilities to hybrid warfare threats in Europe and the Baltic Sea

• NATO announced it will increase intelligence sharing between alliance member states as hybrid warfare threats increase in scale and frequency

Why This Matters
These measures serve multiple purposes:

• Establishing a defensive posture to deter further Russian provocations

• Strengthening NATO’s deterrence to lower the likelihood of hybrid warfare actions

• Pressure Russia into peace negotiations and away from aggression and “saber rattling”

• Ensure Ukraine can continue fighting into 2025

Overall, the deployment of NATO systems to its eastern flank will help deter Russian escalations and, if a peace deal is agreed upon in 2025, act as an enforcement mechanism.

Sources: Reuters, The Defense Post, NY Post, Reuters

Ongoing Political Crisis: South Korea Erupts In Protests After President Declares Martial Law

Summary
On 3 December, South Korean President Yoon Suk Yeol declared martial law after claiming the opposition in Parliament were colluding with North Korea to overthrow Seoul’s democratic system. 109 of 300 parliamentarians made it into the National Assembly to vote down the decision. President Yoon ended martial law, which gave him extraordinary powers, 7 hours after it began. The opposition have called for Yoon’s impeachment.

(Note: This is a developing story and information cutoff for The Intel Brief was at 2200 ET on 4 December)

Findings

• Reasoning: Yoon has accused the opposition of “anti-state activities” and said he is trying to protect democracy and national security. Yoon and his wife have been accused of political and economic corruption.

• Extraordinary Powers: The South Korean constitution says the President can declare martial law. When declared, martial law normally suspends parliament and political demonstrations in addition to putting media under government controls. Violators of these conditions are able to be arrested without warrants.

• Background: South Korea was first under martial law during the rule of Park Chung-hee who, in 1961, seized power through a coup d'état. He was assassinated in 1979 and power changed hands to Major General Chun Doo-hwan. Only massive protests in 1987 led to democratic elections which forced Chun out of power and ended 40 years of authoritarianism.

Why This Matters
The sudden decision by Yoon to enact martial law suggests deep political fragility and the opportunity for backsliding. While South Korea is considered one of Asia’s more secure democratic nations, its political history suggests there is potential and precedent for severe escalations to the ongoing crisis.

While there are no reports of political violence or arrests related to the martial law order, President Yoon has not confirmed whether he will resign. Parliament has called for his impeachment. A vote could happen as early as Friday. It would require a two-thirds vote from parliament and the endorsement of 6 of 9 court justices.

The White House made a statement stating it was concerned with ongoing developments in Seoul, but did not condemn the initial decision by Yoon to enact martial law.

Sources: BBC, Washington Examiner, Reuters, NPR, The Guardian, AP News

NATO: Ukraine Must Be Equipped And Strong Before Negotiations Can Begin

Summary
From 2-3 December, NATO defense ministers met in Brussels to discuss aid for Ukraine and the possibility of peace negotiations with Russia in 2025. NATO member states have not reached a consensus on whether or not Ukraine should be invited to the alliance. Secretary General Mark Rutte said NATO’s focus should be on providing Ukraine aid:

Findings

• Policy Shift: The 2-3 December defense ministers meeting is likely the last one before Donald Trump enters office in January 2025.

• Continued Aid: The US announced it was sending Kyiv another $725 million worth of ammunition, missiles, and mines. Following US elections, Biden committed to getting Ukraine as much aid as possible before leaving office. In a surprise visit to Kyiv, German Chancellor Scholz committed $680 million in aid.

• Russia’s Stance: Previously, the Kremlin said Putin would entertain a peace dialogue but would pursue conditions outlined in June 2024. Those conditions includes no NATO and EU membership for Kyiv and the seizure of Russian-controlled territories from Ukraine. Kremlin spokesperson Dmitry Peskov recently said that there are “no grounds for negotiations yet” while the speaker of Russia’s upper-house of parliament said she expects talks in 2025.

Why This Matters

• NATO's Obligation: NATO is almost certain to continue supporting Ukraine given Russia’s vague diplomatic signals, ongoing military offensives, and its significant increase to defense spending. This support is necessary not only to strengthen Ukraine but also to maintain NATO’s deterrence posture.

• Russian Intentions: Despite Putin’s defense budget increase indicating Russia’s intention to keep fighting, Russia is very likely to maintain a high level of defense spending through 2025 in order to continue rebuilding its military.

• Trump's Policy Uncertainty: The upcoming US presidential transition introduces uncertainty in NATO’s approach to Ukraine. European leaders, aware of Trump’s likely shift in policy, are rapidly boosting their support for Ukraine to ensure Kyiv can fight into 2025.

Sources: US Department of State, The Guardian, Euro News, ABC News

Slovakia PM Continues To Distance Itself From EU, Embrace Moscow Amid Decreasing Support In Parliament

Summary
On 2 December, Slovakian Prime Minister Robert Fico criticized the EU foreign policy chief’s claim that European Union members overwhelmingly support Ukraine. This criticism comes as Slovakia expels two individuals—one Ukrainian and one Hungarian—linked to energy infrastructure sabotage. Fico’s comments highlight Slovakia’s growing divergence from EU policies, especially as bilateral relations with Ukraine deteriorate. Domestically, Fico’s opposition in parliament has called for snap elections.

Findings

• Agitator: Robert Fico is one of the EU’s most pro-Russian politicians. He will attend the 2025 Victory Day Parade in Moscow as Putin’s guest

• Security Threats: On 2 December, Slovakia expelled two individuals for allegedly monitoring energy infrastructure to facilitate sabotage. Previous sabotage of the Nord Stream 1 and 2 pipelines is suspected to have been carried out by Ukrainian personnel.

• Energy Needs: Slovakia has secured a natural gas deal with Azerbaijan as Ukraine shuts down Russian gas supplies to gain leverage for further EU support. Despite suspicions, the EU Commission maintains that Azerbaijani gas does not include Russian exports.

• Domestic Discourse: In Slovakia’s parliament, growing support for the opposition has led to calls for snap elections. Fico's coalition only maintains a 2-seat majority.

Why This Matters

• National Interests: Slovakia’s increasingly pro-Russian stance can be attributed to energy dependence on Russia and concerns that NATO and Moscow are approaching open conflict.

• Fico’s Leadership: Fico’s government prioritizes energy security via Russia. Additionally, there is growing skepticism within Slovakia’s political establishment about EU policies, especially concerning Ukraine. This has led to increased skepticism of EU and NATO supranationalism.

• Ukrainian Policy: Ukraine has acted aggressively to bilateral partners who do not provide unwavering support for its war effort. Ukrainian sabotage of European and Slovakian energy infrastructure, such as the Nord Stream pipeline attacks, exacerbates Slovakia's pro-Russian sentiment by heightening concerns over energy security.

• Domestic Politics: Slovakia’s domestic politics, like much of Europe, is growing increasingly polarized. Fico’s positions and his populist approach to governance have led to decreased support in parliament. Slovakia could face snap elections in 2025 if Fico loses his majority.

Sources: POLITICO, Oil Price, POLITICO, Fidelity Investments, Euractiv

End Brief

That concludes this brief.

Did you notice the new format? Let me know your thoughts:

Thank you,

Nick