Spain has struck a deal with the North Atlantic Treaty Organization (NATO) to be exempt from a commitment to spend 5% of its gross domestic product on defense, Prime Minister Pedro Sanchez said Sunday, June 22. In a televised address , Sánchez argued that such a spending level would be “unnecessary and disproportionate.” Earlier on Sunday, diplomats said NATO’s 32 member states had agreed on a summit statement setting a 5% of GDP target for annual defense and security spending by 2035, despite Spain’s objections. Sanchez had informed NATO chief Mark Rutte of his country’s desire to opt out of a new 5% spending target in a letter sent Thursday, June 19. The letter expressed worries that Spain might disrupt the entire summit. According to Sanchez, they completely understand that other countries want to boost their defense spending, but they will not do that. This statement was made after he noted that Spain can fulfill all its NATO commitments for personnel or equipment by only spending 2.1% of its GDP. Meanwhile, it is worth noting that Spain spent about 1.28% of its GDP on defense last year, which was the lowest amount in the alliance, according to NATO estimates. In April, Sanchez agreed to speed up efforts to reach NATO’s goal of 2% this year. NATO has not yet made the compromise summit text public. It will only be official once the leaders of NATO’s 32 member countries approve it at the summit. However, diplomats mentioned that changing the wording from “we commit” to “allies commit” helped Spain argue that the promise does not apply to every member. President Trump increases defense spending to 5% for NATO members US President Donald Trump demanded a big increase in NATO’s defense spending target of 5% of gross domestic product. This was after NATO chief Mark Rutte suggested the target be reached by increasing NATO’s key target for defense spending from 2% to 3.5% of GDP, while spending an additional 1.5% on related areas such as cyber security and modifying roads and bridges for military vehicles. NATO officials argue that substantial hikes in defense spending are needed to meet the increasing threat from Russia and permit Europe to assume more responsibility for its security, as the United States shifts its strategic focus to China. Sanchez maintains his decision despite Trump’s threats When Sanchez announced that Spain would not comply with the new defense spending target, he risked provoking Trump. Earlier, the president repeatedly emphasized that European countries fall short of their defense budget target. Trump said he would not defend them if they failed to reach this target. In addition, Trump warned Spain on Friday, June 20, that they must meet their target, pointing out that Madrid is notorious for its low defense spending. However, according to him, this would not apply to the US because it had paid a large amount of money over a long period. In 2024, NATO says that Washington devoted approximately 3.19% of its GDP to defense. Still, Sanchez said Spain did not have to achieve the new target and that trying to do so would result in drastic cuts in spending on social services such as state pensions or tax rises. Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now
