Burden-sharing in a trillion-dollar military alliance: The outgoing Secretary General calls for more military spending

30 September 2024

During his farewell speech at an event hosted by the German Marshall Fund (GMF) on 19 September 2024, NATO Secretary General Jens Stoltenberg, following a decade at the helm of the alliance, shared five key lessons for NATO’s continued success:

the importance of continuing to increase defence spending;
ensuring robust economic relations among allies;
military strength as a prerequisite for dialogue (the Ukrainian lesson);
military power has its limits (the Afghanistan lesson); and
the importance of the transatlantic bond between Europe and North America.

This briefing looks at the first of these lessons: the issue of military spending. It examines NATO’s funding dynamics through the national military budgets of member states. The focus is on what NATO describes as the ‘defence investment pledge’—a commitment for member states to allocate at least 2 per cent of their gross domestic product (GDP) to military spending. In the business world ‘investment’ has the positive connotation of leading to future wealth, and here NATO clearly associates such investment as enhancing future collective security. Stoltenberg argued in his GMF speech that “we have to be willing to pay the price for peace”, and that “the more money, the stronger our defences, the more effective our deterrence, the greater our security”. However, despite shaping the military spending of member states on an upwards trajectory over the past decade it is questionable as to whether this resulted in greater security.

Moreover, with European NATO and Canada collectively forecast to spend $506.7 billion in 2024 and the United States $967.7 billion, total NATO military spending is expected to reach $1.47 trillion, up from $1.29 trillion in 2023. Independent estimates suggest that in 2023 NATO accounted for 55 per cent of the global total in military spending. This raises questions as to how much military spending is enough to provide security for NATO member states. Stoltenberg balances the “good news” (of substantial spending increases since 2014) with the “bad news” that this is “no longer enough”. He argues that the recently agreed regional defence plans, with specific capability targets—in terms of weapons, forces and readiness—for each member state, will require allies “to spend significantly more than two percent of GDP on defence in the years to come”.