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NATO Report Shows All 32 Allies Met 2% in 2025 as Europe and Canada Lift Spending 20%

U.S. pressure alongside a harsher security picture pushed allies to raise outlays, with a tougher 5% by-2035 goal now in view.

Prime Minister Mark Carney delivers remarks aboard HMCS Margaret Brooke at HMC Dockyard Halifax, where he marked the NATO achievement made a defence spending announcement.
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NATO Secretary General Mark Rutte reacts during a one-on-one interview with Reuters on the Iran crisis and Ukraine war, at the Alliance headquarters in Brussels, Belgium March 5, 2026. REUTERS/Yves Herman
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Overview

  • NATO, which released its annual report Thursday, said every member met the long-standing benchmark of spending at least 2% of GDP on defense in 2025.
  • Europe and Canada spent about $574 billion to the U.S.’s $838 billion, and NATO data show the U.S. share of alliance spending fell to roughly 59%.
  • Canada reached roughly $63.4 billion, or about 2% of GDP, for the first time since the Cold War after a summer 2025 cash injection of about $9–9.3 billion and reclassifying some agencies under Defence, drawing scrutiny over accounting and staying power.
  • Only Poland, Lithuania, and Latvia exceeded the new 3.5% core-defense level in 2025, and leaders last year set a broader 5% by 2035 target that counts 3.5% for troops and weapons and 1.5% for related infrastructure and cyber projects ahead of July’s Ankara summit.
  • NATO’s chief credited President Donald Trump’s pressure for the surge, while country reports point to real-world effects such as Canadian military pay hikes of up to 20% and fresh orders for rifles and munitions, even as procurement speed and industry capacity remain concerns.