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USA Business Watch – Insightful News on Economy, Finance, Politics & Industry
Home » NATO allies agree to a high 5% defence spending target
Aerospace & Defense

NATO allies agree to a high 5% defence spending target

Bussiness InsightsBy Bussiness InsightsJune 25, 2025No Comments3 Mins Read
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Mark Latte of Donald Trump, executive director of the North Atlantic Treaty Organization (NATO) at the NAGO Summit held in The Hague, Netherlands on Wednesday, June 25th, 2025.

Bloomberg | Bloomberg | Getty Images

The NATO allies on Thursday agreed to more than double their defensive spending targets of 2% to 5% of gross domestic product, in the most decisive move from the alliance for more than a decade.

In the joint declaration, the alliance said it was “united in the face of serious security threats and challenges.” In particular, the long-term threat poses by Russia to the “permanent threat” of Euro-Atlantic security and terrorism.

“The Allies are committed to investing 5% of their GDP annually in core defence requirements and defence-related spending by 2035 to ensure our personal and collective duties,” he continued.

The 5% figure consists of at least 3.5% of GDP to be spent on “pure” defense, with the rest going to “critical infrastructure” related to security and defense, saying “unlocking the preparation and resilience, innovation of our citizens and strengthening our defense industry foundation.”

Allies should submit an annual plan that “shows reliable progressive paths to reach this goal.”

Some member states have yet to meet their 2014 target of spending 2% of their GDP on defense.

The historic movement is against the background of tensions in the Middle East and the ongoing war between Ukraine and Russia. Members have also been pushed into new targets to share more of the burden of collective defense after years of pressure across the terms of both Washington’s Canadians and US President Donald Trump on European allies.

The alliance on Wednesday also reaffirmed the “rotary iron commitment to collective defense” engraved in Article 5 that attacks are an attack on everything.

“We remain united and immovable in our resolve to protect one billion citizens, defend our alliances and protect freedom and democracy,” the statement read.

In response to the summit, NATO Executive Director Mark Latte said the agreement would promote a “quantum leap” in the alliance’s collective defense.

The deal “not only increases our security, it creates jobs,” Latte continued, noting that the allies “have made a critical commitment to addressing serious threats.”

Allies were united in realizing the seriousness of the threat they faced and “knowing that we need to step up to stay safe,” he said.

He said President Trump emphasized that while the US is committed to NATO, he hopes that European allies and Canada will make more contributions.

This is a breaking news story. Please check for more updates.



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