Published by Global Banking & Finance Review®
Posted on June 5, 2025
3 min readLast updated: January 23, 2026
Add as preferred source on GoogleNATO aims to meet Trump's 5% GDP defence spending target by June summit, with discussions on investment plans and timelines ongoing.
By Sabine Siebold and Lili Bayer
BRUSSELS (Reuters) -U.S. Defense Secretary Pete Hegseth said on Thursday he was confident that members of the NATO alliance will sign up to Donald Trump's demand for a major boost in defence spending, adding that it had to happen by a summit later in June.
The U.S. president has said NATO allies should boost investment in defence to 5% of gross domestic product, up from the current target of 2%.
"To be an alliance, you got to be more than flags. You got to be formations. You got to be more than conferences. You need to be, keep combat ready capabilities," Hegseth said as he arrived at a gathering of NATO defence ministers in Brussels.
"We're here to continue the work that President Trump started, which is a commitment to 5% defence spending across this alliance, which we think will happen," Hegseth said, adding: "It has to happen by the summit at The Hague later this month."
Diplomats have said European allies understand that hiking defence expenditure is the price of ensuring a continued U.S. commitment to the continent’s security and that keeping the U.S. on board means allowing Trump to be able to declare a win on his 5% demand during the summit, scheduled for June 24-25.
"We have to go further and we have to go faster," NATO Secretary-General Mark Rutte told reporters on Wednesday.
"A new defence investment plan will be at the heart of the NATO summit in The Hague," he added.
In a bid to meet Trump's 5% goal, Rutte has proposed alliance members boost defence spending to 3.5% of GDP and commit a further 1.5% to broader security-related spending, Reuters has reported.
Details of the new investment plan will likely continue to be negotiated until the eve of the NATO summit.
"We have to find a realistic compromise between what is necessary and what is possible really to spend," German Defence Minister Boris Pistorius said on Wednesday.
Countries remain divided over the timeline for a new pledge.
Rutte has proposed reaching the 5% by 2032 – a date that some eastern European states consider too distant but which some others see as too early and unrealistic given current spending and industrial production levels.
A 2032 target is "definitely too late", Lithuanian Defence Minister Dovile Sakaliene said on Wednesday, arguing for a target of 2030 at the latest.
There is also an ongoing debate over how to define "defence-related" spending, which might include spending on cybersecurity and certain types of infrastructure.
"The aim is to find a definition that is precise enough to cover only real security-related investments, and at the same time broad enough to allow for national specifics," said one NATO diplomat.
(Additional reporting by Andrew Gray, Charlotte Van Campenhout, Benoit Van Overstraeten; Writing by Lili Bayer and Ingrid Melander;Editing by Gareth Jones and Aidan Lewis)
NATO allies are expected to boost defense spending to 5% of their gross domestic product, up from the current target of 2%.
NATO Secretary-General Mark Rutte has proposed reaching the 5% target by 2032, although some eastern European states argue for an earlier deadline of 2030.
Countries remain divided over the timeline for new pledges, and there is an ongoing debate over how to define 'defense-related' spending, which may include cybersecurity and infrastructure.
European allies understand that increasing defense expenditure is essential to ensure continued U.S. commitment to the continent's security.
The NATO summit in The Hague will focus on a new defense investment plan, which is crucial for aligning member states on defense spending commitments.
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