NATO allies have agreed to significantly raise their defense spending, committing to a new target of 5% of gross domestic product (GDP) by 2035. The decision, announced at the 2025 NATO summit in The Hague, marks the alliance’s most substantial defense investment pledge in over a decade.
The agreement comes amid growing global security concerns, particularly the ongoing war in Ukraine, rising tensions in the Middle East, and continued pressure from the United States for allies to share more of the defense burden. The new goal builds on the previous 2% GDP target set in 2014, which several member states have yet to meet.
Under the new framework, at least 3.5% of each country’s GDP will be directed toward core defense spending, while the remaining 1.5% will support defense-related infrastructure, innovation, and civil preparedness. Allies are required to submit annual plans demonstrating how they will incrementally reach the target.
The announcement reaffirms NATO’s commitment to collective defense, as outlined in Article 5 of its charter, which states that an attack on one member is considered an attack on all. This core principle had come under renewed scrutiny in recent years, but the joint statement emphasized unity and resolve.
The shift also reflects a broader rebalancing of NATO, with European members and Canada expected to take on greater responsibility. While some countries, including Spain, expressed reservations about the increase, all members ultimately agreed to the plan.
Leaders at the summit described the decision as a “quantum leap” in strengthening NATO’s defensive posture and economic resilience. The new investment is expected not only to enhance security across the alliance but also to stimulate industrial growth and job creation in the defense sector.
Source: CNBC