Published by Global Banking & Finance Review®
Posted on May 21, 2025
2 min readLast updated: January 23, 2026
NATO is expected to increase its defence spending target to 3.5%-5% of GDP. Italy plans to meet the current 2% target through accounting changes, while proposals are being drafted to manage the increased budget demands.
By Angelo Amante, Giuseppe Fonte
ROME (Reuters) -NATO will raise the defence spending target for its member nations to between 3.5% and 5% of gross domestic product (GDP) from the current 2% at the next alliance summit in June, Italy's Defence Minister Guido Crosetto said on Wednesday.
Under pressure from the United States to raise its outlays on security, Italy said it would meet this year the 2% target through a series of accounting changes.
Proposals have been drafted to boost Italy's defence budget while limiting any impact on its strained state coffers.
"The Italian government will express itself and discuss its ideas (at the June summit), and there NATO will make a decision," Crosetto said, replying to questions in the lower house of parliament.
Raising Italy's defence budget to a target level of 5% of GDP on paper would require more than 60 billion euros ($68 billion), a commitment that might be tough to meet for Italy, which sees its massive public debt rising to almost 138% of GDP in 2026 before edging down the following year.
However, Crosetto said the defence budget ought to include a series of items that were already factored into the overall government budget, such as money spent for operational capabilities, communications and space policies.
He also mentioned spending aimed at increasing the resilience of critical infrastructure and improving military mobility.
In reply to the opposition in parliament, who believe boosting the defence budget would take money away from Italy's social spending, Crosetto said it was ultimately up to parliament to set out the target.
"We are a parliamentary republic and the budget is discussed in this Chamber and voted on in this Chamber, so I will take note of what NATO decides and what parliament subsequently decides," he said.
($1 = 0.8822 euros)
(Reporting by Angelo Amante and Giuseppe Fonte, editing by Hugh Lawson)
NATO is expected to raise the defence spending target for its member nations to between 3.5% and 5% of GDP from the current 2%.
Italy plans to meet the 2% target this year through a series of accounting changes.
Raising Italy's defence budget to a target level of 5% of GDP would require more than 60 billion euros, a commitment that might be tough to meet given Italy's financial constraints.
The defence budget should include items already factored into the overall government budget, such as operational capabilities and spending on critical infrastructure.
The opposition expressed concerns that boosting the defence budget would divert funds from Italy's social spending.
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