Expenditures on defence surged across NATO member states in the past year, with a record number of countries in the alliance hitting internal spending targets.

The latest summary of member states’ defence spending was released by NATO headquarters in Brussels on 17 June, including estimates for 2024 outlays. Those figures show a surge in military expenditures in recent years, both by individual governments and the alliance as a whole.

A historic 23 NATO members are projected to spend the equivalent of at least 2% of their gross domestic product (GDP) on defence in 2024, an internal alliance goal established 10 years ago. That is more than double the 10 countries that met the spending target last year.

Notably, defence expenditures are rising in historic laggards like France and Germany, who have for years failed to meet the 2% goal. Spending across European members of the alliance, plus Canada, was up 18% year-on-year. 

Gripen pilot

Source: Saab

The accession of Sweden into NATO in 2024 helped power a nearly 10% annual increase in defence expenditures by non-US member states compared to 2023

That measure was benefited by Sweden’s entrance into NATO in March 2024. Finland, which joined the alliance in April 2023, was included in last year’s figures.

NATO secretary general Jens Stoltenberg described the results as “the biggest increase in decades” while on an official visit to Washington DC.

“More and more allies are now really stepping up and investing more in our security,” Stoltenberg said on 17 June, following a meeting with US President Joe Biden.

While the surge will benefit European defence manufacturers, US firms in particular stand to gain from the spending spree. Stoltenberg notes that since 2022, over two-thirds of European defence acquisitions were made with American firms.

NATO's Jens Stoltenberg

Source: NATO

Secretary general Jens Stoltenberg says NATO leaders are poised to approve a formal role for the alliance in supporting Ukraine’s fight against Russian invaders

“NATO is good for US security, good for the US industry and good for US jobs,” the former Norwegian prime minister says.

The comments are likely geared toward a domestic political audience in the USA, where right-wing former President Donald Trump is mounting a re-election bid with a platform that has strains of isolationism. Trump has also characterised some countries as free riders on collective security.

Unsurprisingly, defence spending leaders within NATO largely come from the alliance’s so-called “Eastern Flank” of countries bordering Russia. Poland led the pack, spending the equivalent of 4.1% of GDP on its military.

Estonia, Latvia, Lithuania, Finland and Romania were all in the top 10 spenders, in terms of relative GDP. The USA, the UK, Greece and Denmark rounded out that group.

Despite being in the midst of a generational recapitalisation of its air force, Canada remains well below NATO’s 2% target, spending an estimated 1.37% of its GDP equivalent on defence in 2024, according to the latest figures from Brussels.

Canadian defence minister Bill Blair has sought to downplay his country’s miss, preferring instead to highlight future spending increases approved by Ottawa.

“Our defence spending next year alone will increase 27%,” Blair said on 1 May at the Canadian Global Affairs Institute in Ottawa.

That multi-year package calls for procurement of some 140 new combat aircraft, including Lockheed Martin F-35A fighters and Boeing P-8 maritime patrol jets, alongside some $30 billion of investment targeted for modernisations of the joint Canada-USA North American Aerospace Defense Command (NORAD)

Canada’s underwhelming 2024 defence spending is sure to be on the agenda in Ottawa on 19 June, when Stoltenberg is scheduled to meet with Canadian Prime Minister Justin Trudeau.

While in Washington, the NATO secretary general also discussed plans for the annual NATO summit, scheduled for July. The USA is hosting the gathering to mark the 75th anniversary of the alliance’s founding in 1949.

USAF F-22 with Polish F-16s

Source: US Air Force

F-16 operator Poland is currently spending the highest proportion on defence among NATO states, at 4.1% of GDP

Stoltenberg says formalising NATO’s role in supporting Ukraine’s war against Russian forces will be chief among topics for discussion at the summit.

“I expect that… we will agree that NATO will take on a lead role in providing security assistance and training,” the secretary general says, noting that a three-star general would likely be appointed to oversee the logistics and training support.

“This is important because it will provide more predictability, more accountability, when it comes to our support to Ukraine,” he adds. “And it also reduces the burden on the United States.”

While NATO members have provided billions of dollars’ worth of equipment and funding directly to Ukraine, the alliance itself has been more cautious in an attempt to avoid further escalation. That strategy now appears to be changing, with members poised to approve a greater role for NATO.

“As long as [Russian] President Putin believes that they can win on the battlefield [and] that they can wait us out, there will be no lasting peace in Ukraine,” Stoltenberg says. “The best way of achieving [peace] is to strengthen Ukraine, its military capabilities, so they can negotiate from a position of strength and ensure that Ukraine prevails and survives as a sovereign independent nation.”