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Economic Insight > Blog > Business News > Nato promises historic rearmament shift in bid to win over Donald Trump
Nato promises historic rearmament shift in bid to win over Donald Trump
Business News

Nato promises historic rearmament shift in bid to win over Donald Trump

EC Team
Last updated: June 25, 2025 6:48 pm
EC Team
Published June 25, 2025
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NATO allies have pledged in a historic re-soldier change that aims to persuade Donald Trump to raise defense spending to 5% of GDP by 2035, and aims to convince them to maintain their US commitment to protect the continent from invasion.

At a summit designed to win the US president, Trump assures that 31 allies are “with them” that he is alleviating concerns that he was trying to renegotiate a mutual defense agreement that has been forming the bedrock of Europe’s security for 80 years.

Wednesday’s summit in The Hague also issued a joint statement reaffirming the NATO government’s “Iron Clad commitment to collective defense” and pledging to provide a “annual plan that demonstrates a reliable and progressive path” to its 5% target.

He added that a review of spending targets that unlock hundreds of millions of euros to defend hundreds of millions of euros over the next decade will be conducted in 2029.

The US President called the Summit’s achievements “extraordinary” and added that it was “the need for other NATO members to pose a burden on Europe’s defense.”

“It was 2% [of GDP] And we got it to 5%,” he said.

Trump’s affirmation of support for NATO came after he raised vigilance towards The Hague, saying Washington’s commitment to NATO’s Article 5, referring to a mutual defense agreement that “depends on your definition.”

On Wednesday, he vowed to “stand” the rest of the alliance when fears of global instability were shocked by Russia’s full-scale invasion of Ukraine and the conflict in the Middle East, particularly the war between Iran and Israel.

European leaders were relieved by approval of transatlantic debt from longtime NATO skeptics. He has repeatedly called for European countries to spend more on defense and the US to shift military assets from the continent to other regions.

Despite concerns across the scale of fiscal pressure in European capitals, the targets were based on budgets, and leaders praised the summit’s achievements and Trump’s role in forcing them to spend more. The declaration was to “put money where our mouths are,” German Prime Minister Friedrich Merz said.

However, the summit communique contains only one reference to Russia, citing one sentence that refers to “a long-term threat to the security of the Euro-Atlantic brought about by Russia” and “a sovereign commitment to providing support to Ukraine.”

It shows a notable shift from the alliance that has spent the last three years focusing on Kiev’s support, reflecting Trump’s rambling attitude towards Russia and Ukraine.

Some allies have yet to meet their previous 2% spending targets, so Spanish Prime Minister Pedro Sanchez has broken the ranks to secure a 5% demand waiver. Trump responded by labeling the country as “bad,” threatening to “double payments” in US-EU trade negotiations.

The president has revealed that Washington, the alliance’s biggest defense spender, is not bound by a 5% target, consisting of core defense spending of 3.5% of GDP and 1.5% of related infrastructure.

According to a memo from Abn Amro Economists, the 3.5% target is “unrealistic for most countries,” adding that “there is a really big rise in defence spending is primarily limited to Germany.”

However, NATO Secretary General Mark Latte, who decided to focus solely on spending at the summit, said the target would produce “a stronger, fairer, more deadly NATO.”

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Flag of alliance members at NATO headquarters in Brussels

“European allies and Canada will do more heavily lifting,” he told reporters after the meeting. “Work won’t stop here. This is the first day.

Some allies were unsettled by Latte’s full praise for Trump, which he called “daddy,” but ultimately assured the US president that he would remain satisfied, two officials told the Financial Times.

Latte later defended the president’s handling as a “taste matter,” adding that Trump “deserves all the praise.”

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TAGGED:bidDonaldHistoricNATOpromisesrearmamentshiftTrumpWin
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