At least five percent of GDP NATO states agree on defense spending

Will Donald Trump call off the NATO summit if the allies do not agree to a massive increase in their defense spending? This scenario was on the table - but now there is a deal.

A few days before the NATO summit in The Hague, the 32 alliance states have reached an agreement on the planned new target for the minimum level of national defense spending. As the German Press Agency learned after the end of a written decision-making process, the allies want to declare their willingness at the summit to increase their annual defense-related expenditure to at least five percent of gross domestic product (GDP).

An amount of at least 3.5 percent of GDP is to be allocated to traditional military expenditure. It will also be possible, for example, to include expenditure on combating terrorism and infrastructure that can be used for military purposes. This could include, for example, investments in railroad lines, armored bridges and expanded ports. The deadline for meeting the new target for defense spending is 2035, according to diplomats from the text for the planned final declaration of the NATO summit.

Currently, the NATO target for defense spending only provides for annual national spending of at least two percent of GDP. The reason for the increase now agreed is in particular the threats posed by Russia, but also US President Donald Trump's demand that the Europeans should assume primary responsibility for conventional deterrence and defense on their continent in the future.

Status quo from 1996Kremlin does not want to end Ukraine war until Nato withdraws from Eastern Europe

Trump puts the pressure on

During his first term in office, Trump repeatedly criticized what he saw as insufficient defence spending by European allies and accused them of relying too much on the USA for protection. On several occasions, he even threatened to withdraw the USA from Nato. In recent weeks, it was repeatedly said that Trump might not travel to the NATO summit if there was no agreement on the five percent target.

Germany had already backed US President Trump's call for a massive increase in the allies' defense spending to five percent of gross domestic product at a NATO foreign ministers' meeting in Turkey in May. Most recently, only Spain had put up resistance among the NATO states.

A tour de force, especially for Germany

The new target represents a huge challenge for many NATO states - even if it does not have to be reached until 2035. Last year, Germany only achieved a rate of around 2.1 percent, and according to German Chancellor Friedrich Merz, every percentage point more would currently mean around 45 billion euros more in defense spending for Germany. At five percent, according to Merz's calculations, defense-related expenditure of 225 billion euros per year would currently be necessary. To put this into perspective: total federal budget expenditure amounted to around 466 billion euros last year.

The new target is only likely to be comparatively unproblematic for the USA itself and countries such as Estonia, Latvia and Greece. They already have traditional defense spending of over three percent. Poland was the frontrunner last year with a GDP ratio of 4.1 percent. According to alliance figures, the USA most recently had a GDP ratio of around 3.4 percent.

The text for the final declaration of the NATO summit is likely to be sobering for Ukraine. According to the text that has now been agreed, Ukraine is only vaguely promised continued support. At last year's summit in Washington, NATO had promised Ukraine security support amounting to 40 billion euros. It was also stated at the time that its path to membership was irreversible. Due to resistance from the USA in particular, it was no longer possible to repeat such formulations.