A war on?

Is there a war on? Big EU powers still short of NATO spending targets

Only 7 of 30 alliance members spent at least 2 percent of their GDP on defense in 2022.

BY LILI BAYER

Not even a war has succeeded in pushing Europe’s biggest powers to reach their defense spending targets.

The Continent’s largest economies all fell short of a common goal of spending 2 percent of economic output on defense, according to a NATO report published Tuesday. 

And across the entire military alliance, only seven out of 30 members spent at least 2 percent of their GDP on defense last year. 

And although that amounts to billions, officials and experts warn the organization’s members will need to spend much more to assure its security. 

The figures, all NATO estimates for 2022, show that while allies have been pouring significantly more money into their militaries for years, many are still largely lagging behind an alliance spending target, set in 2014, to spend 2 percent on defense within a decade. 

Of 30 members, only Greece, Poland, the Baltic states, the United Kingdom and the United States spent more than 2 percent of their economic output on defense last year, NATO Secretary-General Jens Stoltenberg’s annual report shows. 

Estonian Prime Minister Kaja Kallas, whose country reached 2.12 percent last year according to the report, said on Tuesday that she was “quite shocked” when looking at who is and is not fulfilling the target.

“Come on, it’s not possible — I think everybody should understand, knowing and seeing what is happening in Ukraine, that we don’t have that time,” she told POLITICO. 

The report does underscore, however, how NATO allies have been continuously investing and are now spending significantly more than when the target was first agreed. 

“European Allies and Canada have increased defence spending for the eighth consecutive year,” the report said. “In total, over the last eight years, this increase added USD 350 billion for defence,” it added. 

Plans to boost investment

Nevertheless, America remains NATO’s moneybags. 

While the U.S. represents 54 percent of the alliance’s economic output, it contributes 70 percent of defense expenditure, the report noted. 

The next-biggest spender, the U.K., amounted to about 6 percent of the alliance’s total spending, while Germany stood at around 5 percent. 

A senior European diplomat, who spoke on condition of anonymity to discuss sensitive alliance dynamics, said that what matters is the positive trajectory, and that many allies have plans in motion to boost investment. 

“Some nations already announced at least 2.5 percent, several even higher … there are nations that have not met the ambition, but at least have a plan,” the diplomat said. 

“The trend has been positive,” they said, although “we need to invest more.”

Indeed, there is an understanding within the alliance that promising to boost defense spending and actually doing it are not the same thing.

“Political proclamations about boosting defense capacities are welcome,” said a senior Central European defense official. Making pledges is easy, they added.

“But spending substantial extra money on defense is very difficult in practice,” the official said, pointing to numerous bottlenecks impacting European countries. 

These include inefficient defense planning, a shortage of raw materials for production of weapons and ammunition, long procurement processes and limited production capacity that could take years to expand.