NATO’s new 5 percent spending pledge is already testing the alliance’s unity, because allies must now show how they will pay for it.
Quick Take
- NATO allies agreed in The Hague to a new target of spending **5 percent of gross domestic product** on defense and security by 2035.
- The plan splits that goal into **3.5 percent for core defense** and **up to 1.5 percent** for broader security work.
- Allies also agreed to file **annual plans** that show a credible path toward the target.
- Spain has signaled hesitation, and some states still struggle to meet the older 2 percent goal.
What NATO Agreed To
At the 2025 NATO Summit in The Hague, allies agreed to a new spending benchmark that goes far beyond the old 2 percent guideline. NATO says members will invest 5 percent of gross domestic product annually in core defense requirements and defense- and security-related spending by 2035. The alliance also says allies will submit annual plans showing a credible, incremental path to reach that goal.
The new target is not one simple line item. NATO says at least 3.5 percent of gross domestic product must go to core defense needs tied to capability targets. Up to 1.5 percent can go to broader security work such as critical infrastructure, network defense, civil preparedness, resilience, innovation, and the defense industrial base. That structure gives members more room to classify spending, but it also makes public oversight harder.
Why The Target Matters
NATO officials and supporters argue the pledge is meant to match a harder security picture. The alliance has pointed to Russia, terrorism, and other threats as reasons for the shift. NATO also says European allies and Canada increased defense spending by 20 percent in 2025, and all allies now meet the old 2 percent target. That is real progress, but the jump to 5 percent is much larger than the last one.
The scale of the task is still the central issue. Reuters reported that all NATO members spent about 2.61 percent of GDP on defense last year, while NATO’s own estimates put total allied military spending at more than $1.3 trillion in 2024. Intereconomics said the 5 percent benchmark places heavy demands on European allies, and even countries that already spend more will need to raise budgets again. The change is less a tweak than a major reset.
Where The Pushback Comes From
Some analysts see the pledge as a serious defense shift. Others see a political signal with a weak record of follow-through. The Stockholm International Peace Research Institute warned that the target carries “challenges and risks,” especially because countries may meet parts of it through flexible accounting rather than clear military gains. That concern matters because the 1.5 percent security category can blur the line between defense and general government spending.
'Step up immediately!' Donald Trump issues ultimatum to NATO allies on brink of summit. Donald Trump has issued an ultimatum to Nato allies on the eve of a Nato summit, telling them to step up defence spending "immediately" or face consequences.
Washington officials have… pic.twitter.com/7SL2OhXkU7
— Steve Ruud (@ruud_steve9838) July 6, 2026
Spain is the clearest test case for the alliance’s claim of unity. NBC News reported that Spain expressed hesitance as the deal took shape, and other reports say some members want carve-outs or special treatment. That friction reflects a broader problem that has haunted NATO for years: allies often endorse big goals, then struggle to meet them. The new pledge may improve burden-sharing, but it also exposes how uneven that burden still is.
Sources:
youtube.com, pbo-dpb.ca, cfr.org, nbcnews.com, nato.int, cdainstitute.ca
