* Hagel says slide in military spending poses threat
* NATO to draw up longer-term measures for September summit
* NATO promises support for defence reforms in Ukraine
(Updates with Rasmussen, Ukraine, Polish ministers)
By Adrian Croft and David Brunnstrom
BRUSSELS, June 3 U.S. Defense Secretary Chuck
Hagel urged NATO allies on Tuesday to raise their defence
budgets due to the Ukraine crisis, saying a spending slide could
pose as big a threat to the alliance's future as any enemy.
He also called on allies to review how their militaries were
trained and equipped to meet new security challenges, arguing
NATO should expect Russia to continue to test its resolve, even
though it was withdrawing its troops from the Ukraine border.
"We cannot shrink from this challenge ... We must reaffirm
the security guarantees that lie at the heart of this alliance.
And we must hold fast to those guarantees by summoning the will
to invest in a revitalised NATO," Hagel said, according to the
text of a speech to NATO defence ministers meeting in Brussels.
The 28-member alliance is studying what longer-term steps it
needs to take to bolster its eastern defences and improve its
ability to respond to the unorthodox tactics used by Russia
during its annexation of Ukraine's Crimea region.
As the NATO meeting began, the White House unveiled plans
for a $1 billion initiative to send more of its military to
Europe on a temporary basis but stopped short of promising to
beef up its permanent presence as some of Washington's allies
Hagel urged NATO to "come to grips with the potentially dire
consequences of current trends in reduced defence investment -
consequences that, in the long term, pose as much of a threat to
the alliance as any potential adversary.
"Allies must ... reverse these trends," he said.
Many NATO allies have slashed defence spending in response
to the financial crisis. Only a handful meet NATO's target of
spending two percent of their economic output on defence.
Latvia, Lithuania and Romania have announced plans to
increase defence spending in response to the Ukraine crisis and
Poland also proposed on Tuesday to slightly boost its military
NATO Secretary-General Anders Fogh Rasmussen, who also
rammed home the message about the need to halt the slide in
defence spending, said he expected allies to make commitments on
military spending at their summit in Wales in September.
After the ministers held talks with acting Ukraine Defence
Minister Mykhailo Koval, Rasmussen said NATO would produce a
support package by the end of June to help Ukraine with defence
reforms and modernisation of its armed forces.
Individual allies had also come forward with offers of help
for Ukraine, including advice, technical assistance and material
support, but this did not include weapons, NATO and Ukrainian
"We received assistance from France, Poland, the United
States, the United Kingdom - also assistance is coming from
other allies. There is a very long list of items. At the moment
we are talking only about non-lethal (equipment)," Koval told
Ukraine's ambassador to NATO told Reuters in April that Kiev
had asked NATO allies for supplies for its army, which is
battling pro-Russian separatists in the east of the country,
ranging from uniforms to spare parts and aircraft fuel.
In the three months since the Ukraine crisis erupted, the
U.S.-dominated alliance has sent fighter planes and ships to the
region and stepped up military exercises to reassure eastern
European allies alarmed by Russia's actions, while making clear
it has no intention of intervening militarily in Ukraine.
The defence ministers agreed to develop a "readiness action
plan" for the NATO summit with longer term measures for beefing
up eastern European security.
These could include pre-positioning equipment in eastern
Europe and preparing infrastructure to enable rapid
reinforcement, more military exercises and shortening the
response time of NATO's rapid reaction force.
Special operations forces are one of the priority areas the
United States believes NATO should focus on developing, Hagel
told the meeting. "Russia's asymmetric tactics in Ukraine
underscore the need to enhance allies' unconventional
capabilities," he said.
Ministers from Germany, Denmark and Poland, which work
together in NATO's Multinational Corps Northeast, told NATO
counterparts they had agreed to upgrade the readiness of the
corps' headquarters in Szczecin, Poland, a NATO official said.
The headquarters is likely to get more staff and equipment
so it could take command of exercises and potentially any
reinforcement effort needed in eastern Europe.
However, Poland, which wants large numbers of NATO troops
stationed permanently on its soil, said beefing up the
headquarters was not enough.
"We don't want the strengthening of the command centre to be
seen as the only aspect of bolstering NATO presence in the east.
We expect much more and we are talking about this," Polish
Defence Minister Tomasz Siemoniak told reporters in Brussels.
Many allies are hesitant about permanently basing large
numbers of troops in eastern Europe, a move Russia says would
violate its 1997 agreement with NATO. NATO officials insist that
the reinforcements and exercises under discussion are within the
terms of the agreement.
Ministers also agreed on a new cyber defence policy, calling
for improved information sharing and mutual assistance between
allies. It also calls for better cyber defence training and
exercises and closer cooperation with industry.
(Additional reporting by Justyna Pawlak; Editing by Tom