Lithuania, Estonia Become First NATO Countries to Commit to Spending 5% of GDP on Defence

Lithuania is ready to invest 5-6% of GDP in defence by 2030, while Estonia will spend 5%, now this figure is only 3.7%, the Financial Times reports.

Thus, they became the first NATO countries to pledge to spend more than 5% of their GDP on defence to increase their military capabilities after US President Donald Trump called for it. Earlier, Trump demanded that Europe invest more in defence and even threatened that the US would withdraw from NATO. 

In an interview with the FT, Lithuanian Foreign Minister Kęstutis Budrys said that Europe is entering a ‘new era’ and stressed that his country will increase defence spending to 5-6% of GDP starting next year and at least until 2030. This is almost double the current level of funding.  

‘Of course, there is pressure, and it is good and constructive pressure from our strategic and largest ally in NATO (the United States - ed.). We cannot ignore these signals. But this is not the only reason... It is vital for us to have real capabilities for war,’ Budrys said.  

Estonian Prime Minister Kristen Michal also said that his country plans to increase its defence budget to 5% of GDP, up from the current 3.7%.  

‘Our key security partner (the United States - ed.), under the leadership of its new president, has sent a clear message: NATO's defence spending must increase. We know our adversary, and I fully agree - our goal should be 5%,’ Michal said.  

European officials say that NATO plans to increase its unofficial defence spending target from the current 2% to 3%, or 3.5% of GDP, at its June summit in response to Russia's invasion of Ukraine. At the same time, US President Donald Trump continues to insist on raising this level to 5%, and some NATO countries, including Poland, which already spends more than 4% of GDP on defence, support this proposal.  

According to the FT, in 2024, 23 out of 32 NATO member states reached the 2% of GDP target. However, countries such as Spain, Italy and Belgium still spend less than 1.5%.  

In addition, there are concerns in Europe about how to finance increased defence spending and whether citizens will accept cuts to other public services.  

On 23 January, US President Donald Trump once again called on NATO member states to raise the minimum defence spending level to 5% of GDP. Previously, NATO leaders did not support this proposal, although they recognised the need to increase funding.