Finance
Struggling to meet NATO goal, Italy mulls stretching defence budget
Published by Global Banking & Finance Review®
Posted on April 4, 2025
3 min readLast updated: January 24, 2026
Global Banking & Finance Review®
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Published by Global Banking & Finance Review®
Posted on April 4, 2025
3 min readLast updated: January 24, 2026
Italy may include coastguard in its defence budget to meet NATO targets, as it faces U.S. pressure to increase spending. This move could help Italy reach the 2% GDP goal without new investments.
By Angelo Amante and Giuseppe Fonte
ROME (Reuters) - Italy is considering including police and coastguard services in its defence budget so it can point to a quick increase in security spending as its struggles to meet U.S.-led NATO targets, two government sources said.
The tactic - which one former Italian envoy to NATO said was unusual but would not necessarily break the alliance's rules - underlined the challenge states are facing as they respond to pressure from U.S. President Donald Trump to up contributions.
Highly indebted Italy's projected defence budget for 2024 was 1.49% of gross domestic product, NATO figures show, below the military alliance's current 2% target which Trump wants raised to 5%.
Two government sources, who asked not to be named, said Italian Prime Minister Giorgia Meloni may include the coastguard and some of the national police forces in the defence budget to get closer to the 2% target without fresh investment.
A third government source said any measure would need cabinet approval but it was not immediately clear when the plan would be examined.
NATO did not immediately respond to a request for comment. The Italian defence ministry said it had no information about the plan.
A factsheet on NATO's website says coastguards and police can be included in defence spending but only "in proportion to the forces that are trained in military tactics, are equipped as a military force, can operate under direct military authority in deployed operations".
Stefano Stefanini, a former Italian ambassador to NATO, said he had not heard of other countries making the same move, but thought it could get the go-ahead.
"I don't think NATO would create problems with such an initiative if it is well constructed and well presented," he said.
"There is a logic to it given the prevailing concern in the countries over illegal immigration, which also leads to a security implication for the coastguard."
The European Commission has proposed to let all 27 EU governments increase defence spending by 1.5% of GDP each year for four years without triggering any disciplinary steps, as the bloc weighs options to counter potential threats from Russia.
But a public debt seen rising to almost 138% of GDP from 135.3% in 2024 leaves Rome with limited leeway, and pushed Economy Minister Giancarlo Giorgetti to propose to EU members a common guarantee scheme to finance such spending while limiting the impact on national budgets.
Defence is a sensitive issue in Italy, where a recent poll in daily Corriere della Sera showed nearly 40% are against the European Commission initiative to rearm the bloc, compared with less than 30% in favour.
(Editing by Andrew Heavens)
The article discusses Italy's consideration to include police and coastguard in its defence budget to meet NATO spending targets.
Italy is under pressure from the U.S. to increase its defence spending to meet NATO's 2% GDP target.
Italy's high public debt limits its ability to make new investments in defence.
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