By Andrius Sytas

VILNIUS (Reuters) -The U.S. Department of Defense informed European countries last week that military support under a program known as Section 333 will be cut to zero from the next fiscal year, a Lithuanian defence ministry official said on Friday.

Two sources familiar with the matter said on Thursday the United States will phase out some security assistance for European countries near the border with Russia, raising concerns among key recipients such as Lithuania, Estonia and Latvia - former Soviet republics now in NATO and the European Union.

Lithuania's Defence Ministry Policy Director Vaidotas Urbelis told reporters in Vilnius that, last week, the U.S. Department of Defense told Europeans that the Section 333 programme "will be set at zero for all European countries" from the next financial year.

Section 333 is an authority under which the U.S. provides training and equipment to enhance the security of partner states.

The cuts, which need to be confirmed by Congress, do not affect the deployment of U.S. troops, nor the support through the separate U.S. programme called Foreign Military Financing, which is administered by the U.S. Department of State, he said.

Lithuania has suggested it take over part of the funding of the separate Baltic Security Initiative support programme, which is focused on the three Baltic states and is also under review by the U.S. Department of Defense, he added.

IMPORTANT SIGNAL

The U.S. military assistance "has served as a very important political signal of U.S. support", Estonian Defence Ministry spokesperson told Reuters in an email that did not confirm or deny the move

"Security assistance to the Baltic States has so far been a strongly supported programme", she added. "(It) has enabled us, among other things, to accelerate critical capability development and to choose U.S. equipment".

The Baltic States plan to spend 6.3 billion euros in 2025, about 3-4% of their gross domestic product (GDP), almost three times more than before Russia's 2022 invasion of Ukraine.

All three expect to further increase defence spending to over 5% of GDP next year.

Lithuania has received $200.3 million of Section 333 funding over the financial years 2018-2022, and Latvia and Estonia a total of $360.2 million over the financial years 2018-2021, according to the U.S. State Department.

The Estonian Defence Ministry spokesperson suggested it could continue: "The current administration's direction is to significantly cut foreign aid, but the final allocations will be determined... between the administration and Congress".

(Reporting by Andrius Sytas, editing by Terje Solsvik and Philippa Fletcher)