BRUSSELS, July 10 — Against the backdrop of a war on the continent’s eastern flank, the question of how much Europe is willing to pay for its own defence has moved from a perennial talking point to a hard political test. A decade after NATO allies gathered in Wales and pledged to move toward spending at least 2% of their gross domestic product on defence within ten years, the numbers tell a story of uneven progress.
The 2014 commitment was driven by Russia’s annexation of Crimea, a shock that jolted the alliance into rethinking decades of post-Cold War dividend-taking. At the 2023 Vilnius Summit, allied leaders reaffirmed the target and went further, declaring that 2% should be considered a floor, not a ceiling.
It was a clear signal that the era of low defence budgets was, at least in the corridors of NATO, over. Yet according to NATO’s 2023 annual report, only 11 of the then-31 members met the benchmark. Poland led the alliance at 3.9% of GDP, followed by the United States at 3.5%.
Greece, at 3.0%, rounded out the top three. The Baltic states and Finland, all with a direct view of Russia’s borders, were among the compliant: Estonia at 2.7%, Lithuania at 2.5%, Finland at 2.5%, and Latvia at 2.3%.
Romania and Hungary each spent 2.4%, while the United Kingdom hit 2.2% and Slovakia reached exactly 2.0%. The list of those that fell short included some of the largest European economies. Germany spent 1.6%.
France, with its nuclear deterrent and global military posture, was at 1.9%. Italy, the third-largest economy in the eurozone, spent just 1.5%. Canada, the alliance’s other North American member, was at 1.3%, and Spain brought up the rear among the major economies at 1.1%.
The 2% target is not a formal treaty obligation but a political guideline. Its origins go back to the 2006 Riga Summit, where allies first set an informal target of 2% of GDP.
In practice, the guideline has served as a measuring stick for burden-sharing debates, particularly from Washington. The wider picture of alliance spending is dominated by the United States. In 2023, NATO’s combined defence expenditure was approximately $1.3 trillion.
The U.S. accounted for roughly 70% of that total. This imbalance has long been a source of friction, with successive American administrations pressing European allies and Canada to shoulder a fairer share.
There is a second target, often overlooked in the public debate. NATO also asks members to spend 20% of their defence budgets on major equipment, including research and development. In 2023, 20 allies met that mark.
This metric is seen by defence planners as a measure of whether countries are actually modernising their forces or simply paying for personnel and pensions. What is at stake now is whether the momentum from Vilnius can be sustained. The pledge that 2% is a floor, not a ceiling, implies that the 11 members that met the target should not consider their work done, and that the laggards face mounting pressure to accelerate.
Against this backdrop, the politics of defence spending are shifting. In Germany, the government has created a special fund for the Bundeswehr, but the 1.6% figure from the 2023 report shows how far the country remains from the target.
In Italy, the 1.5% figure places it among the lowest spenders in the alliance, a fact that has drawn attention in both Brussels and Washington. The 2014 Wales pledge set a deadline of 2024. That year has now passed, and the scorecard is clear.
The alliance has made progress, but the distribution of the burden remains uneven. The question in the corridors of power is whether the next round of commitments, expected at a future summit, will include harder mechanisms to enforce the guideline.
For now, the numbers sit on the table. Poland spends nearly four times the share of its economy on defence that Spain does. The Baltic states, with far smaller economies, outspend Germany and France as a proportion of GDP.
The United States continues to carry the bulk of the financial weight. The alliance’s ability to maintain a credible deterrent, particularly as the war in Ukraine grinds on, will depend on whether these disparities narrow. The 2% floor, as a political commitment, will be tested not in summit declarations but in national budget laws.
That is where the real work begins.
