NATO’s latest summit in The Hague ended with an ambitious decision: member countries will aim to spend 5 percent of their gross domestic product (GDP) on defence by 2035. NATO Secretary General Mark Rutte called it a “quantum leap” in security policy, and President Donald Trump, who has long pushed allies to boost their military spending, claimed credit for the target. But the numbers tell a stark story—most countries will need to more than double their current defence budgets to meet this new goal, the Washington Post reported.
When NATO last set a collective spending benchmark—2 percent of GDP in 2014—fewer than a third of member states met it. A decade later, only about 70 percent are on track. Reaching 5 percent will require a significant increase in public investment, political support, and perhaps creative accounting.
Only a few countries are close
According to NATO data, Poland leads the alliance with defence spending over 4 percent of GDP. The country ramped up its military investment following Russia’s 2022 invasion of Ukraine, and it now spends more on defence than any other European member in proportion to its economy. Estonia, Latvia, and Lithuania—all of which border Russia or Belarus—have also significantly increased their spending and are well above the 2 percent mark.
Finland, which joined NATO in 2023, is likewise increasing its military budget in response to security concerns along its 800-mile border with Russia. The United States remains the largest NATO spender in absolute terms, currently allocating around 3.5 percent of GDP to defence. But despite this leading position, the US is still shy of the 5 percent mark and is pushing other countries to contribute more.
Western Europe lags behind
Western European countries, including some of NATO’s largest economies, have been slower to act. Germany’s defence spending remains around 1.6 percent of GDP despite pledges to overhaul its military. Canada spends just 1.3 percent. Spain, which has trailed behind for over a decade, has publicly stated it will not reach 5 percent, with Prime Minister Pedro Sánchez arguing that smaller increases are sufficient to uphold European security commitments.
Trump responded to Spain’s stance with threats of trade retaliation, saying at a press conference, “We’re negotiating with Spain on a trade deal, and we’re going to make them pay twice as much—and I’m actually serious about that.”
NATO prepares for a 2029 review
To track progress, NATO leaders have agreed to a formal review of the 5 percent target in 2029. Countries are also expected to include dual-use infrastructure projects—like ports, roads, and energy grids—in their defence budgets if they serve a military purpose. That may help narrow the gap on paper, but real military capability will require hard spending choices.
As geopolitical tensions rise, NATO’s decision underscores a broader shift in global defence priorities. The message from the summit is clear: if Europe wants to rely less on the US, it must start spending like it.
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