Russia is an acute threat to “every sane country” and Europe is only at the beginning­ of rebuilding its defences, the Estonian prime minister has said.

Kristen Michal called for the European Nato allies to start jointly procuring weapons and seize almost €200 billion­ in frozen Russian state ­assets to fund Ukraine’s reconstruction.

Like Poland and its Baltic neighbours Lithuania and Latvia, Estonia directly borders Russia and sees the alliance’s ability to deter Moscow from attacking the eastern flank as a question of existential importance.

All four frontline states plan to raise their military spending to more than 5 per cent of GDP over the next two years and are building fortifications along their frontiers with Russia and Belarus, including a “drone wall” with tens of thousands of sensors linked by artificial intelligence to anti-drone systems­.

After Russia sent at least 19 drones across the Polish border and violated Estonian airspace with an Mi-8 military helicopter last week, Michal, 50, said his country’s repeated warnings about Russian aggression had been fully vindicated­.

“Russia is an acute threat to Europe, to Nato, to every sane country in the world,” he said. “We have even been seen as a little bit paranoid talking about Russia’s threats [in the past]. But right now, everything we in the Baltics or Poland or the Nordics have been talking about has come to life.”

Estonia is at pains to emphasise that it regards Russia’s imperialism and ­belligerence as a menace not only to its ­immediate neighbours but to the alliance as a whole and to other parts of the world where its mercenaries have muscled in, such as sub-Saharan Africa.

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Michal suggested that if a peace deal or a “frozen conflict” situation were to be reached in Ukraine, tens of thousands of demobilised Russian soldiers would spill out and destabilise regions far beyond Europe, like the Wagner private military company has done.

He said: “Russia has more men under arms than before the war. They are ­getting higher salaries, they have fighting capabilities. Some of them are criminals and they have to be treated as ­heroes in Russia.

“They won’t go back into the regular army. They will be joining in different para­military operations or covert operations all around the planet: in Europe­, burning down warehouses, shops in Asia, in Africa. This is not a question only of the eastern border [of Nato]. This is the question of what will happen all over the planet when the war ends.”

Michal, who succeeded Kaja Kallas as the Estonian prime minister and leader of the centre-right Reform Party last summer, thought Europe was still a long way from developing the military strength it needed to keep the Kremlin at bay. “It will take a lot for Europe to become much stronger,” he said. “Right now we are still at the start.”

In Estonia, which has a comparatively slim budget deficit and one of Europe’s lowest public debt piles relative to the size of its economy, rearming at pace has necessitated painful spending cuts and tax rises. Although the European Union recently loosened its fiscal rules to allow member states to borrow for defence investment, the ­financial squeeze remains intense.

“You have to cut public budgets, you have to cut different services,” Michal said. “We had to raise VAT and take loans that must be repaid. It is tough but there’s no other way if you want to live in peace. On the rational level, you know you need 5 per cent of GDP in defence. On the emotional level, you feel, ‘I just don’t like it, I liked life better when we had more money’. That paves the way for populists in any country.”

One factor that made this process slightly easier was the wholesale digitisation of Estonia’s public services, which Michal estimated was saving his country the equivalent of 2 per cent of its GDP each year. Britain is among the countries studying the model.

Michal would also like to see European allies pool their resources and buy armaments together to drive down costs. “We queue in the same lines. If you had common procurement, that would help a lot. Maybe we will buy ten [units of a weapons system], Poland will buy a hundred. That becomes cheaper and much easier to access.”

He said the Russian violations of Polish airspace last Wednesday were the first time Nato had been “tested in airspace”. He insisted that its response, with aircraft and air defences from at least five allies involved in shooting down four of the drones, had convincingly passed the test.

Nato looks for cheaper way to counter waves of drones

Michal also welcomed the alliance’s ensuing Eastern Sentry initiative to shore up the air defences on its eastern flank with half a dozen additional jet fighters and other systems as “good news for bad reasons”.

French Rafale fighter jet during NATO's Eastern Sentry operation over Poland.

French Rafale jets patrolling over Poland on Saturday as part of the Eastern Sentry operation

ETAT MAJOR DES ARMÉES/AFP

The White House’s ambiguous reaction to the drone incident unsettled some European states. President Trump initially suggested the incursions might have been a mistake before remonstrating with Russia for sending the machines into Poland’s vicinity.

Over the weekend Trump issued an ultimatum to the rest of Nato, saying he would only impose “major” sanctions on Moscow and its supporters if the EU countries were to entirely stop ­importing Russian oil and collectively set 50 to 100 per cent tariffs on goods from China.

However, Michal was adamant that he believed America would continue to uphold its security pledges to its allies. “Trump said that [while] he is the president of the United States, he is commi­tted to Nato and article 5,” he said.

“That was very well understood. But the ask in return was that Europe take defence much more seriously, to spend on it. For me it was a very clear message. Everybody from Russia to China understands that the United States is committed­ to Nato.”