When it comes to the contentious issue of spending within the North Atlantic Treaty Organisation (NATO), the recent summit in The Hague marked a rare success story. 

At the prodding of US President Donald Trump—long a vocal advocate for increased European defence investment—the 32 members of the alliance agreed to a historic commitment: a new benchmark of five percent of GDP dedicated to defence by 2035.

This new target will be divided into two main components. Each member state will raise its core defence budget to 3.5 percent of GDP. 

An additional 1.5 percent of GDP will be allocated toward defence-adjacent expenditures, including dual-use infrastructure such as highways and airports that can support military mobility, and enhancements to cyber defence capabilities.

 The military aid provided to Ukraine can also be counted in the total to reach five percent.

Hitting the five percent mark has been a long time coming. The debate over NATO’s defence spending dates back nearly two decades. 

At the 2006 NATO summit in Riga, leaders first agreed on a two percent of GDP target for national defence spending. However, progress was slow. By the time Russia occupied Ukraine and illegally annexed Crimea in 2014, only three countries— the United States, the United Kingdom, and Greece—met the two percent benchmark. 

Greece only met the target due to relaxed accounting rules that included civil and veterans’ pensions in its defence budget.

That same year, at the Wales Summit, NATO reaffirmed the two percent goal and gave itself a decade to meet it. 

By the time of last year’s summit in Washington, 23 member states had achieved the two percent threshold. While that marked significant progress, Russia’s full-scale military campaign of Ukraine in 2022 made clear that even two percent was no longer sufficient.

Why NATO’s defence targets keep rising

When President Trump returned to the Oval Office this year, he reignited the debate and pushed for more ambitious targets. 

His consistent public pressure and demands for European allies to take greater responsibility for their own defence have made an impact. 

But Russian President Vladimir Putin also deserves a degree of responsibility—or credit—for spurring Europe to act.

Without his aggression in 2014 and again in 2022, Europe’s defence budgets would likely still be stagnant. For example, since 2014 Europe has increased defence spending in real terms every year.

The rationale for the five percent target is clear. NATO faces a radically altered security landscape. Russia has shown that it has both the military capacity and political will to use force to achieve its objectives. 

Ukraine is the most visible example, but Russian hybrid warfare tactics are playing out across the Baltic region, the Balkans, and elsewhere in Eastern Europe. NATO has a duty to deter and defend against these threats—but it can’t do so without proper investment.

Next year’s NATO summit in Türkiye will provide an opportunity to ensure this new five percent benchmark is more than just rhetoric. 

Ankara should lead by proposing a special session for finance ministers at the summit. In most NATO countries, especially those with parliamentary systems, finance ministers hold tremendous sway over public spending decisions. 

Inviting them to the table would help align budgetary planning with strategic defence objectives. It would also give these ministers ownership over NATO’s future and help them make the case for increased defence spending at home.

Türkiye calling for such a session would be historic—and it could be pivotal in making the five percent target politically sustainable. In addition, NATO leaders should encourage member states to enshrine the five percent requirement into national law. 

This would reduce the influence of party politics and create continuity across electoral cycles. As coalition governments are formed in European capitals over the coming years, the five percent goal should be explicitly included in coalition agreements.

President Trump will undoubtedly be watching. His administration has made clear that it expects Europe to do more. He will likely hold NATO members to account and call out backsliding where he sees it. 

That pressure—coupled with the ongoing Russian threat—should serve as a powerful incentive for European nations to follow through on their commitments.

Collective capacity

Finally, increasing defence spending is not just about military capability. It will also bolster the transatlantic defence industrial base.

European Union countries are already moving toward more coordinated procurement and production. For example, the EU’s Security Action for Europe (SAFE) fund enables borrowing to fund joint defense projects in Europe and its European Defence Fund is a major research and development initiative designed to boost capabilities.

As they do, NATO members outside the European Union—such as the United States, the UK, and Türkiye —must not be left behind. These countries have some of the most advanced and capable defence industries in the world. Full transatlantic cooperation will be vital for collective security.

As an intergovernmental security alliance, NATO is only as strong as the commitment and capabilities of its member states. Years of underinvestment in defence across much of Europe have resulted in serious capability shortfalls and troubling gaps in readiness.

While Article 5 of the 1949 North Atlantic Treaty—declaring that an attack on one is an attack on all—is widely known, it is Article 3 that underpins the Alliance’s long-term strength. 

Article 3 commits each member to “maintain and develop their individual and collective capacity to resist armed attack.” Yet how many NATO members today can honestly say they are living up to this obligation?

After years of dithering, NATO finally appears to be on the right path. With proper follow-through, the alliance can be stronger, more credible, and more capable than ever before. 

The five percent commitment marks a turning point. Next year’s summit in Türkiye will be the first test to see if this new benchmark will become a lasting reality.