THE 6 NATO ALLIES IN DANGER OF TRUMP'S DEFENCE SPENDING BACKLASH: A COUNTRY-BY-COUNTRY RECKONING

A New Standard Nobody Asked For — and Six Countries That Can't Meet It

On June 18, 2026, U.S. Defence Secretary Pete Hegseth walked into a NATO defence ministers meeting in Brussels and delivered what reporters in the room described as one of the most confrontational speeches an American official has ever made to the alliance. He announced a Pentagon-led, six-month review of all U.S. military forces stationed in Europe. He described it as "a review that some countries will fail, and others will pass with flying colours." He called it "shameful" that European NATO allies had refused to grant U.S. forces access to their bases to strike Iran during Operation Epic Fury. And he reiterated a demand he had first articulated in May 2026: that the minimum acceptable defence spending level for NATO partners, in Washington's view, is no longer the 2 percent of GDP that had been the alliance's longstanding benchmark, nor even the 3.5 percent agreed at last year's Hague summit, but a full 5 percent — a level that would dwarf anything any European democracy has spent on its military in the post-Cold War era.

This declaration arrived at a genuinely paradoxical moment for the alliance. In March 2026, NATO's Secretary General Mark Rutte released the Annual Report for 2025 confirming that, for the first time in recorded alliance history, all 32 NATO members had met the old 2 percent GDP defence spending target — a milestone that NATO watchers had been predicting, and sceptics had been dismissing, for a decade. European allies and Canada increased defence spending by 20 percent in a single calendar year. Norway became, for the first time ever, the NATO ally spending the most per capita on defence — surpassing even the United States. Poland was spending 4.7 percent of its GDP on its military and was written into national law as a floor. The Baltic states were racing toward 5 percent with formal government commitments. The alliance was, by the old standard, genuinely succeeding.

But Trump's standard is no longer the old standard. And the six countries caught most acutely in the gap between what they have committed to and what Washington now demands are facing something genuinely new: the credible, documented possibility that the United States will review its troop deployments, its Article 5 commitments in practice, and its bilateral trade relationship with allies that fail to meet a threshold that, for most of them, would require near-total fiscal restructuring to achieve.

Here is the detailed story of each of those six countries — who they are, what they spend, why they're struggling, and what the backlash from Washington actually looks like.

The New Playing Field: From 2% to 5% in Two Years

To understand why specific countries are in danger now when they were not a year ago, it helps to understand how dramatically the goalposts have moved in the space of twenty-four months.

In 2014, NATO leaders agreed at the Wales Summit that all members would aim to spend at least 2 percent of GDP on defence by 2024. That was an "aim to move toward" commitment — deliberate diplomatic language designed to be aspirational rather than binding. For most of the intervening decade, the majority of NATO members ignored it, and the U.S. complained loudly but took no concrete action.

Trump's return to office in January 2025 changed the calculation. The first major shift came at the NATO Hague Summit in June 2025, where alliance leaders agreed to a new target: 3.5 percent of GDP on direct defence spending, plus an additional 1.5 percent on what NATO calls "security-related enablers" — infrastructure upgrades such as roads, bridges, ports, and railway bridges capable of supporting military convoy movements, plus cyber resilience capabilities and societal preparedness programmes. The 3.5 plus 1.5 formula was Washington's explicit attempt to reach a "5 percent" headline that Trump could claim as a victory, while allowing the 1.5 percent enabler component to encompass spending many European countries were already incurring in other budget lines, making the overall total marginally more achievable than a straight 5 percent hard military number.

Spain, Belgium, and Slovakia all signalled difficulty with the 5 percent target at the Hague summit, with Spain's Prime Minister Pedro Sánchez saying explicitly and publicly that his country would not meet it — calling 2 percent "sufficient" and "realistic." The language of the Hague agreement included, according to the Atlantic Council's Rachel Rizzo, "just enough wiggle room for some allies (such as Spain) to opt out."

Then, in May 2026, Hegseth raised the bar further — not just to 5 percent total, but to 3.5 percent of GDP as the minimum pure defence spending commitment Washington demanded from "model allies." The review he announced in Brussels in June 2026 is explicitly tied to this new standard. The six-month timeline means conclusions will arrive before the next NATO summit in Ankara, Turkey, in July 2026 — directly shaping the context of what is expected to be the most fraught transatlantic summit in recent memory.

1. SPAIN — The Country That Said No to 5 Percent

Of all the countries in the alliance, Spain is the one that has most explicitly and publicly rejected the Trump administration's defence spending demands — not as a diplomatic softening or a budget constraint, but as a stated policy position by its head of government.

Spain currently spends approximately 1.2 to 1.3 percent of its GDP on defence, making it consistently the lowest-spending armed ally in the entire alliance — a position it has held for most of the past decade. At the 2025 Hague Summit, Spain secured what the Atlantic Council described as a "formal exemption" from the 5 percent benchmark, contending that equivalent capability outcomes could be achieved with spending of roughly 2.1 percent of GDP. The argument — essentially that Spain's geography, its military geography, and its economic structure mean that a 2.1 percent spending figure produces more effective capability per euro than headline GDP percentages suggest — was not warmly received in Washington, but was acknowledged in the summit communiqué's deliberately flexible language.

Prime Minister Pedro Sánchez's refusal to commit to 5 percent is a genuine political position rooted in the economics and politics of governing a country with 101.8 percent debt-to-GDP, a recent history of fiscal austerity that caused serious social damage, and a domestic political coalition that spans parties ranging from socialist to far-left — none of which has any enthusiasm for a major military spending surge. The Spanish economy is the 14th largest in the world. A genuine 5 percent defence spending commitment would require roughly an additional $50 billion per year in military expenditure — a figure that would be politically unsustainable in any Spanish governing coalition currently imaginable.

Trump singled Spain out directly at the Hague summit, saying "they want a little bit of a free ride" and threatening to make Spain "pay twice as much" in trade negotiations. The Global Statistics' analysis of NATO budget data notes that Spain's "formal exemption from the 5% pledge is the most politically awkward data point in the alliance's spending picture: a country of 47 million people and the world's 14th-largest economy, which benefits fully from NATO's Article 5 collective defence guarantee, explicitly rejected the spending commitment that every other ally signed." Hegseth's June 2026 review is widely expected to identify Spain as one of the clear cases where the alliance relationship needs re-examination.

2. BELGIUM — Paper Commitments, Structural Doubts

Belgium has, on paper, met the old 2 percent threshold — NATO's March 2026 report listed it among the five nations (along with Albania, Canada, Portugal, and Spain) that had reached exactly 2 percent in 2025. But Belgium's trajectory to that milestone was almost comically protracted — the country averaged just under 1.3 percent for the decade between 2014 and 2024, reached 2 percent only under intense international pressure in 2025, and now faces a commitment to reach 5 percent by 2035 that the Heritage Foundation has explicitly flagged as credibility-stretching.

The Intereconomics analysis of NATO spending capacity identifies Belgium as facing the most demanding percentage increase among all major NATO economies, requiring a 292 percent increase in its defence burden to reach 5 percent from its recent baseline. Only Luxembourg faces a more extreme relative adjustment. Belgium's debt-to-GDP ratio of 104.5 percent severely limits its fiscal room to manoeuvre. Its political system — one of the most fragmented in Europe, with governments routinely taking over a year to form and coalition arithmetic that makes large-scale spending commitments politically hazardous — further compounds the structural difficulty.

There is also an additional irritant between Belgium and the Trump administration that goes beyond spending numbers. Brussels is NATO's headquarters city, hosting both the alliance secretariat and the institutional apparatus of NATO's integrated military command. The NATO Civil Budget administration is headquartered in Luxembourg. Both countries have, for decades, benefited enormously from the economic, diplomatic, and reputational value of hosting NATO's core infrastructure while spending comparatively little on actual military capability. This combination of symbolic centrality and material undercontribution is precisely the kind of arrangement that drives the Trump administration to frustration.

3. ITALY — A Large Economy With a Long History of Lagging

Italy is NATO's tenth-largest defence spender in absolute dollar terms — which sounds impressive until you note that Italy is also the alliance's third-largest European economy, meaning a relatively small share of a large GDP still produces a significant dollar number. As a percentage of GDP, Italy spent approximately 1.49 percent on defence in 2024, rising to an estimated 1.5 percent in 2025 — technically meeting the 2 percent threshold only in the most optimistic readings. NATO's most recent published data placed Italy among the countries at exactly 2 percent for 2025, but analysts note that this involved significant budget recharacterisation rather than new military capability spending.

Italy has announced an ambition to double its defence spending to 3 percent of GDP over four years — a commitment made under current prime minister Giorgia Meloni, who has cultivated a closer relationship with Trump than most European leaders. Meloni's Italy is, by temperament and political identity, more aligned with the nationalist, sovereignty-focused currents that animate Trumpism than the social democratic parties governing many NATO allies. This political alignment has given Italy somewhat more diplomatic runway with Washington than Spain or Belgium enjoy.

The structural problem, however, is Italy's debt-to-GDP ratio of 135.3 percent — the second highest in the alliance after Greece — which severely constrains its fiscal capacity to fund major military investment without corresponding budget cuts elsewhere or without violating European Union fiscal rules. The Intereconomics analysis calculates that Italy would need to increase its defence burden by 211 percent to reach 5 percent of GDP — more than tripling its current military expenditure — a figure that strains credibility even with a sympathetic government in Rome. Italy's path to becoming a "model ally" in Hegseth's language runs directly through a fiscal landscape that makes the journey extraordinarily difficult regardless of political will.

4. CANADA — The Awkward Ally Next Door

Canada's defence spending has long been the most diplomatically sensitive underperformance in NATO, for the simple reason that Canada is the United States' immediate northern neighbour, largest trading partner, and second-oldest formal treaty ally. When Trump or Hegseth criticise European allies for free-riding on American security, the implicit subtext is always that at least they are geographically distant. Canada's free-riding — and it is widely described in those terms by Republican defence hawks — happens directly adjacent to the United States, on a shared continent that American strategic doctrine treats as a single security space.

As recently as 2024, Canada was spending approximately 1.37 percent of its GDP on defence, making it one of the bottom performers in the alliance for years. The political context included a decade-long Trudeau government that consistently prioritised social programmes over military investment, and a national political culture that never fully internalised the urgency that Russia's 2022 invasion of Ukraine created for European allies with direct geographic exposure to Russian aggression.

Canada's new government, led by Prime Minister Mark Carney and installed in early 2026, has moved on defence spending with considerable urgency. At the Brussels defence ministers' meeting in June 2026, Canada's Defence Minister Bill McGuinty made a point of declaring that Canada had crossed the 2 percent threshold — "Canada is particularly pleased to be here for the first time after meeting its two per cent GDP target, actually over two per cent" — and outlined a path to 3.5 percent, saying Canada is "well on track for our 3.5 per cent target and putting together the plans necessary to meet that target and of course the five per cent target by 2035."

This trajectory is genuinely more credible than it was under the previous government — Carney has made defence spending a centrepiece of his government's positioning against Trump's pressure — but it starts from a very low baseline and involves fiscal commitments that are genuinely large by Canadian historical standards. The danger for Canada is not that Washington ignores its progress, but that the pace of acceleration is not fast enough to remove it from the watch list in the context of a review that looks at current spending levels rather than future commitments.

The Iran war adds a specific bilateral irritant. Canada, like most NATO European allies, declined to participate in Operation Epic Fury, citing the lack of prior consultation and the legal and political complexity of joining a military strike on a sovereign nation without UN authorisation. Hegseth explicitly called it "shameful" that European allies refused access to bases for Iran strikes — language that, in context, extended to Canada as well.

5. SLOVENIA — The Smallest Problem, the Longest Road

Slovenia is the least discussed of the six countries in danger of backlash, in part because it is a small economy — approximately $60 billion GDP — whose absolute military expenditure figures, however low their percentage, are strategically marginal in alliance terms. But the politics of Slovenia's defence spending have been unusually dramatic relative to its size.

In 2024, Slovenia spent approximately 1.29 to 1.35 percent of its GDP on defence — one of the lowest shares in the alliance. When the 5 percent target was agreed at the Hague summit, Slovenian Prime Minister Robert Golob made the remarkable announcement that he was considering calling a national referendum on NATO membership itself — a move described in Heritage Foundation analysis as explicitly in "response to the new 5 percent requirement." The Slovenian parliament subsequently blocked the referendum plan, but the fact that a sitting NATO member's head of government publicly floated the idea of a membership exit vote over the spending question illustrated the depth of domestic resistance in some quarters of the alliance.

The Intereconomics analysis calculates that Slovenia needs to increase its defence burden by 282 percent to reach 5 percent of GDP — nearly quadrupling current spending — from a starting point of well under 1.5 percent. Slovenia's debt position is considerably more manageable than Italy's or Belgium's, but the economic and political infrastructure for a military build-up of that scale simply does not exist in a country that has never had a large professional military establishment and whose political culture does not centre defence as a national priority.

What makes Slovenia politically relevant beyond its size is its position as a symbol of the alliance's weakest links. In Hegseth's review framework, Slovenia represents precisely the kind of member that can be identified as a laggard without meaningful strategic consequence for the overall alliance posture — making it a convenient, low-cost example for Washington to make a point.

6. LUXEMBOURG — The Most Extreme Case

Luxembourg is in a category of its own when it comes to the structure of its NATO contribution, and understanding why requires a moment of context. Luxembourg is the smallest NATO member by population that maintains its own armed forces — approximately 660,000 people — and has historically spent between 0.5 and 0.7 percent of its GDP on defence, making it by a considerable margin the lowest-spending armed member of the alliance. Its annual defence budget, even after significant recent increases, is measured in the low hundreds of millions of euros — compared to billions or tens of billions for larger members.

NATO has accommodated Luxembourg's structural limitations by recognising that its contribution to the alliance takes other forms: it hosts NATO's Civil Budget administration, it provides airlift and logistical support, it contributes personnel to NATO operations, and it participates in alliance missions at a level proportionate to its military establishment. Luxembourg has its own agreed formula — spending 2 percent of Gross National Income rather than GDP, a different metric — but even that goal, which the country has formally committed to reaching by 2030, remains aspirational rather than achieved.

The 5 percent target that Hegseth is using as his benchmark would, in Luxembourg's case, require what the Intereconomics analysis calculates as a 419 percent increase in the country's defence burden — more than quintupling current spending as a share of economic output, from a country that is entirely surrounded by much larger alliance members and has never historically required or built independent large-scale military capability. The Global Statistics analysis notes the fundamental absurdity of the hard application of GDP-percentage metrics to a microstate: "Luxembourg, completely encircled by much larger allied states, faces the most extreme adjustment, needing to raise its burden by 419%." Luxembourg is simultaneously the home of NATO's administrative headquarters and the member least capable of meeting the spending standard its political leaders are being asked to commit to.

The Wider Context: The Iran War Overlay

Defence spending percentages are only one dimension of the current NATO crisis. What makes the June 2026 moment qualitatively different from previous rounds of the burden-sharing argument is the Iran war overlay that Hegseth explicitly invoked in Brussels.

When the U.S. and Israel launched Operation Epic Fury against Iran in February 2026, the Trump administration expected — or at least hoped — that NATO allies would contribute to the effort in some form. What it received instead was near-universal refusal. Most European NATO members declined to allow U.S. forces to use their bases for Iran strikes, declined to participate in the military operations, and in several cases publicly expressed concern about the legality and strategic wisdom of the action. The CFR's James Lindsay documented that Trump's threat to withdraw from NATO was directly linked to "the refusal of many NATO countries to assist with Operation Epic Fury," noting that Trump was "surprised they were not willing to follow his lead."

Hegseth in Brussels explicitly connected these two grievances — underspending on defence and refusal to support Iran strikes — in a single narrative about allies who benefit from American security guarantees while declining to share American strategic burdens. "It's shameful that European allies refused to give U.S. forces access to bases to strike Iran," he told the defence ministers. The six-month review he announced is therefore not simply a defence spending audit; it is an assessment of the overall value of each alliance relationship to Washington's global strategic posture, with Iran-war cooperation as an additional variable sitting alongside spending percentages.

This double standard — spending AND strategic solidarity — puts the six countries identified above in a particularly difficult position, because several of them (Spain, Belgium, Italy, Canada) were among the most vocal in declining to participate in or endorse the Iran strikes. Their defence spending underperformance and their Iran war non-participation compound each other in Washington's narrative.

What the Backlash Actually Looks Like

Trump's and Hegseth's pattern of "backlash" against NATO laggards has, historically, been a mixture of rhetorical pressure, specific singling out of individual countries at public events, and bilateral trade threats. The most concrete recent example: at the Hague summit, Trump singled out Spain by name and said he would make Spain "pay twice as much" in trade negotiations. During Trump's first term, similar language was directed at Germany, France, and others.

The six-month Hegseth review announced in June 2026 is the most formally institutionalised version of this pressure yet — it creates a bureaucratic process with a specific outcome (countries will "fail" or "pass with flying colours") and a specific timeline that runs directly into the Ankara summit. Countries that fail the review face the prospect of reduced U.S. force presence on their soil, reduced priority in Pentagon planning, reduced intelligence sharing, and the possibility of bilateral trade pressure. None of these backlashes would remove a country from the Article 5 collective defence guarantee as a formal matter — the NATO treaty does not permit selective application of Article 5 based on spending compliance. But they could reduce the practical military capability that the U.S. contributes to those countries' defence, which in the current European security environment is not a trivial distinction.

The deeper structural question — one that the Heritage Foundation, the Council on Foreign Relations, and the Atlantic Council have all examined — is whether NATO can survive as a credible alliance if the world's largest military power openly declares that some members' failure to meet its preferred spending standards will lead to de-prioritisation in its defence planning. The CFR's Lindsay posed the question directly: "Will NATO's Seventy-Seventh Anniversary Be Its Last?" The answer, as of June 2026, is genuinely uncertain in a way it was not five years ago.

Sources

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