Published by Global Banking & Finance Review®
Posted on January 24, 2025
3 min readLast updated: January 27, 2026
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Trump questions US NATO spending, urging members to increase defense budgets to 5% GDP. Current goal is 2%, with discussions on a new target.
By Trevor Hunnicutt
WASHINGTON (Reuters) - U.S. President Donald Trump said on Thursday he was not sure the United States should be spending anything on NATO, telling reporters the U.S. was protecting NATO members, but they were "not protecting us."
Trump repeated demands that other members of the transatlantic alliance spend 5% of their gross domestic product (GDP) on defense – a huge increase from the current 2% goal and a level that no NATO country, including the United States, currently reaches.
"I'm not sure we should be spending anything, but we should certainly be helping them," Trump told reporters after signing an executive order in the Oval Office. "We're protecting them. They're not protecting us."
"They should up their 2% to 5%," he said, repeating his remarks earlier to the World Economic Forum in Davos, Switzerland.
Washington finances 15.8% of the 32-member military alliance's yearly expenditure of around $3.5 billion. That is the joint-largest share, alongside Germany's, according to a NATO breakdown for 2024.
Indirect U.S. financial contributions to the alliance - which is made up of the U.S., Canada and more than two dozen European countries - include military forces but do not form part of the organization's annual budget.
The overall U.S. defense budget outstrips those of other NATO members and totaled $816.7 billion in 2023, more than half of the total expenditure of the alliance as a whole.
Trump's new secretary of state, Marco Rubio, spoke to NATO Secretary General Mark Rutte on Wednesday and reinforced the U.S. commitment to the alliance, while the two also "discussed the importance of having capable defense Allies and real burden sharing," the State Department said on Thursday.
Officials from NATO countries and analysts say NATO won't heed Trump's proposal for such a massive hike in defense spending but will likely agree to go beyond its current target.
Analysts say a 5% figure would be politically and economically impossible for almost all members. However, a new target is likely to be agreed at a NATO summit in The Hague in June, spurred by fears that Russia may attack a NATO country after Ukraine and by Trump's exhortations, officials said.
Some expect agreement on a target of around 3% of GDP. But even that would be a stretch for many, who barely meet or fall short of the 2% goal now, a decade after it was set. Eight NATO members do not meet the current target.
(Reporting by Trevor Hunnicutt, additional reporting by David Brunnstrom, writing by Andrea Shalal and David Brunnstrom; Editing by Chizu Nomiyama and Rosalba O'Brien)
The main topic is Trump's questioning of US spending on NATO and his call for increased defense contributions from NATO members.
Trump proposed that NATO members increase their defense spending to 5% of GDP, up from the current 2% goal.
The US finances 15.8% of NATO's yearly expenditure, which is the joint-largest share alongside Germany.
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