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ATO appears to be getting serious about spending enough on defense to keep Russia and other threats at bay. In the June NATO summit at The Hague, Netherlands, members vaulted past the alliance’s longstanding goal—never quite achieved—of all members spending at least 2 percent of their gross domestic products on defense. Instead, member states committed to spend 5 percent of GDP over the next 10 years. The bar could be set even higher in the future.
NATO allies have “laid the foundations for a stronger, fairer and more lethal NATO,” said Secretary-General Mark Rutte at the close of the summit. The spending increase “will fuel a quantum leap in our collective defense.”
The meeting included extensive discussions on how members can better integrate their collective defense industries to generate needed equipment.
Citing the “long-term threat” from Russia and other “profound security threats and challenges,” NATO’s end-of-meeting communique said members committed to “invest 5 percent of GDP annually on core defense requirements as well as defense- and security-related spending by 2035.”
Championing the 5 percent goal were Poland, the Baltic States and NATO’s newest members, Finland and Sweden, all of whom share a border with Russia. They were joined by the U.S., France, Germany, the Netherlands, and the U.K.
“Our investments will ensure we have the forces, capabilities, resources, infrastructure, warfighting readiness, and resilience needed to deter and defend in line with our three core tasks … deterrence and defense, crisis prevention and management, and cooperative security,” NATO declared.
Whether member states can get to the 5 percent level remains to be seen. NATO set the goal of investing 2 percent of each member state’s GDP in 2006. As of the end of 2024, only 22 of NATO’s 32 treaty partners had met the mark.
The U.S. has spent an average of about 3.5 percent of GDP on defense since the mid-2010s, down from a modern high of 4.9 percent in 2010. For 2025 and 2026, even with the $150 billion in one-time plus-ups from the “so-called” Big Beautiful Bill Act passed in early July, U.S. defense spending will be just 3.2 percent of GDP. President Donald Trump said at the summit that the U.S. should be excused from the new spending goal because he believes “we’re … there already.”
NATO’s new 5 percent target comes in two parts. Members agreed to spend 3.5 percent of GDP on actual military items, such as troops, combat aircraft, munitions, artillery, vehicles, and ships. Members can achieve the other 1.5 percent by investing in infrastructure that NATO forces will need in wartime—roads, rail, ports, airfields—or on cybersecurity, civil preparedness, hardening power, and communications for increased “resilience” or by directly contributing war materiel or cash to Ukraine in its fight against Russia.
All for One and One for All
Alliance members also reasserted their “ironclad commitment to collective defense,” known as Article 5 of the NATO treaty, which declares that an attack on one member is considered an attack on all, and that all will respond to an aggression on any member. It was first invoked after the 9/11 attacks on the U.S. in 2001.
The reassertion of Article 5 seems to be the other side of a deal that President Trump has pressed for over the years with dire hints that the U.S. might not come to the aid of its European allies in the event of a foreign threat unless NATO members spend more for their defense.
The U.S. provides much of NATO’s combat power and nearly all of its nuclear forces for strategic deterrence. Some 84,000 U.S. troops are deployed to Europe in direct support of NATO.
As recently as June, Trump answered cryptically when questioned about whether the U.S. would respond if a fellow NATO member was attacked: That depends, he said, “on your definition” of attack.
At the Summit, however, he voiced clear support for Article 5: “I stand with it,” he said. “If I didn’t … I wouldn’t be here.”
Getting to 5 Percent
Rather than set the 5 percent goal and hope for the best, NATO members established an annual review process. The allies agreed “to submit annual plans showing a credible, incremental path to reach this goal,” the communique stated.
“The trajectory and balance of spending under this plan will be reviewed in 2029, in light of the strategic environment and updated capability targets,” NATO announced. By then, after the next U.S. presidential election and depending on the state of war in Ukraine, among other factors, NATO will assess the situation. The allies also agreed to hold to a 2014 pledge to spend 20 percent of their defense investments on “major equipment.”
Despite the stronger wording than in past goal-setting steps, NATO has no forcing mechanism to compel members to meet such commitments. While Germany is doubling its defense budget through 2029, others such as Spain, have balked. Spain has said it will hit the 2 percent goal this year and meet all its obligations to NATO by raising spending to 2.1 percent by 2029.
Pedro Sanchez, the Spanish prime minister, called the 5 percent goal economically “counterproductive” for that country, as it might require cuts to public health and education. But Spain, along with Belgium and Italy, nevertheless support the overall goal, although the three sought a 10-year timetable to reach the new standard.
German Chancellor Friedrich Merz, spelling out his nation’s defense spending plans earlier this year, committed to building “the strongest conventional army in Europe.” This he said, is “not to do the United States a favor, but because Russia actively threatens the freedom of the entire Euro-Atlantic region.”
Germany will hit the 3.5 percent of GDP defense spending goal by 2029, raising its defense budget from roughly $100 billion in 2025—about 2.4 percent of GDP—to $190 billion over that span, including military aid to Ukraine.
Poland and the Baltic states, closer to Russia and more fearful of its ambitions, argued that the five-year timetable is too slow and that even the 2 percent benchmark might not be achieved before the Ukraine war ends.
Finnish President Alexander Stubb called the new spending targets “the birth of a new [and] … more balanced NATO” and said they will return the alliance “to the defense expenditure levels of the Cold War.” He called the increases “a big win … for both President Trump and … for Europe.”
But as if to demonstrate the varying level of commitment across the spectrum of NATO members, Slovakia declined to commit to a future spending figure.
Let Kiev Do It
Ukraine’s desire to become a NATO member and gain the security of having NATO’s full military commitment in its defense against Russia’s invasion remains unfulfilled. NATO reiterated that Ukraine’s security “contributes to ours,” and by counting “direct contributions toward Ukraine’s defense and its defense industry when calculating” members’ defense spending, the alliance acknowledged that aid as roughly equivalent to national defense investment.
Admission to NATO must be unanimous among current members, and the Trump administration has put off such consideration indefinitely.
Since the war in Ukraine began, most NATO members—as well as a broader coalition of non-NATO members of the European Union and others—have contributed cash, as well as both lethal and nonlethal aid to Kiev. The 57-nation Ukraine Defense Contact Group—comprising armaments directors from all NATO nations—has met regularly to discuss how to meet Ukraine’s needs for ammunition and other weapons. The group has moved to remove supply chain obstacles, donate materiel from member military forces, standardize the provision of equipment where possible, and plan out same-item production in multiple countries, such as 155 mm artillery shells.
New Emphasis on Shared Production
The communique says that NATO reaffirms “our shared commitment to rapidly expand transatlantic defense industrial cooperation,” and “harness emerging technology and the spirit of innovation to advance our collective security.” NATO will “work to eliminate defense trade barriers among allies and will leverage our partnerships to promote defense industrial cooperation.”
The verbiage resulted from sidebar discussions among members that the alliance needs not only to spend more, but spend wisely, and indicates a consensus to jointly develop new defense technologies and spread production out across many countries.
These conclusions have been gelling in NATO for at least two years and address some of the production shortfalls that the contact group has warned of in previous summits. The language also signals a heightened focus on Alliance readiness and sustainability.
NATO Defense ministers meeting in Brussels in February—ironing out details that would be finalized at the June summit—noted that they are quickening the pace of moving to standardize NATO armaments and equipment.
“The Alliance’s role as a convener, standard setter, requirements setter and aggregator, and delivery enabler, has been increasingly leveraged to expand defense industrial capacity, and recent actions taken have set a framework for allies to better deliver against their NATO capability targets,” the defense ministers said in their concluding statements. They noted that at last year’s summit in Washington, NATO members took an “Industrial Capacity Expansion Pledge,” which “outlines the commitment to accelerate the growth of defense industrial capacity and production across the Alliance; foster a sustainable, innovative and competitive industrial base, where reciprocal cooperation and openness are the norm; shore up industrial resilience, deliver critical capabilities urgently, and increase large-scale, multinational procurement.”
The defense ministers also agreed “develop and share” their countries’ national military plans and strategies with alliance partners, update the plans frequently, and report to the group their “measurable outcomes” toward modernization.
Echoing domestic discussions in the U.S. defense industrial base, the ministers said they would ensure suppliers had “increased insight,” “clear demand signals,” and where possible, “long-term orders.” They also pledged to use multiyear and multinational procurement contracts for priority equipment.
Homework for the defense ministers includes identifying and reporting on risks to their critical defense manufacturing capabilities, supply chains, and access to key raw materials and components. Non-U.S. countries will also explore creating U.S.-style materials stockpiles and present “mitigating solutions” that could benefit the entire alliance.
The ministers also pledged to partner with Ukraine’s defense industry “to the fullest extent” to help that country indigenously produce as much war materiel as possible.
Air Force Gen. Alexus G. Grynkewich, in his Senate confirmation hearing to become Supreme Allied Commander of NATO and head of U.S. European Command, emphasized that a strong NATO, “capable of defending Europe, remains essential to American interests.”
While the U.S. may have shifted its main focus toward Asia, he said, “European and American security remain … intertwined.”