The NATO 5 Percent Objective: A Symptom of Europe’s Security Challenge

On 24–25 June, the NATO summit took place in the Hague, reuniting all the leaders of the largest military alliance in the world. What resulted from the meeting was an increase in the member states’ government spending for common security (NATO, 2025). The objective set for 2035 has been set to 5% of government spending on defense, being divided between 3.5% on defense and 1.5% on security-related developments, such as infrastructure (NATO, 2025). Often in economics, the catchphrase “throw money at the problem” is used to describe problems that can be solved by injecting hard currency into the market, and it seems that NATO states have taken it and applied it to the security sector.

NATO and Europe may seem to be back on the international military chessboard. However, with a deeper analysis, this new declaration is the symptom of the inefficiencies of the European security sector. Beginning with the statement itself, one thing is quite obvious to the naked eye when looking at the 5% increase: the shift of the security policy of NATO becoming ‘money’ rather than ‘outcome’ oriented. There is no common objective of what NATO wants to achieve, be it a common military industrial production facility, increasing the efficiency of its output, or a procurement policy. Rather, Europe made itself content with pleasing the old Trumpian rhetoric, which puts ‘paying’ as the paramount metric to determine what foreign policy to implement.

A Lack of Direction, Commitment and Cooperation

Despite the previous sour remark, the results of the 2025 NATO summit have paved the way to political and rhetorical solutions, rather than technical ones. The budget increase for each member state allows Trump to paint the summit as a political victory to its national electorate, making Europe “pay” for NATO and Ukraine (Yaffa, 2025). This idea is even more evident when looking at the sectors to which the NATO spending can be used, including infrastructure and loosely defined ‘security’ matters (SIPRI, 2025). This definition allows European states to ‘fudge the numbers’, including loosely related projects into the NATO spending denomination (SIPRI, 2025).

Just as an example, Italian Infrastructure Minister, Matteo Salvini, proposed a mega bridge between Sicily and mainland Italy as a suitable project that can be defined as security spending (Pagella Politica, 2025).

This is the result of a split in the 5% spending objective, with 3.5% being allocated on what has been the existing core NATO military spending, while the remaining 1.5% is to be allocated on: ‘developing the defence industrial base’ and defence-related infrastructure (SIPRI, 2025). However, it remains unclear what qualifies for the 1.5% spending budget.

Trump saved face vis-à-vis the electorate, and European leaders can fudge the numbers of NATO spending; it sounds like the perfect deal, that keeps everybody happy. However, injecting money into these substantial projects is a problem for states with significant government deficits. As a result, European governments are left with two choices: either to implement budget cuts in sectors such as welfare, or to increase the tax burden on their citizens (European Commission, 2025).

Both of these options are widely opposed in European politics and electorates, with budget cuts being more likely than increasing the tax burden of states that already have the highest ones in the world.

Photo by Marek Studzinski on Unsplash

This is no mystery, although EU leaders pretend to ignore it. PM of Spain, Pedro Sánchez, already bargained for exceptions for his country, acknowledging how the Spanish state had no capacity or will to ensure the achievement of such goals, declaring to NATO Secretary General Mark Rutte, that Spain “cannot commit to a specific spending target in terms of GDP” (Blackburn, 2025). Other countries, such as Hungary and Slovakia, are currently contemplating similar exceptions, and the target sparked heated debates in Slovenian politics (Al Jazeera, 2025).

Economics: The Key to European Security

Money is a big issue for the European security system and network, and when looking at the data, this becomes even more evident. Europe falls prey to economies of scale when it comes to military spending. According to the Stockholm International Peace Research Institute, in 2024, the European NATO members spent 454 billion USD in defense, more than Russia’s 149 billion USD, and more than half of America’s 997 billion USD [2;7].

As a matter of fact, the EU has a large number of soldiers, spending around 40 per cent of its defense budget on salaries for the military personnel (Colombatto, 2025). Most of the European tank production faces multiple challenges, the most pressing being the high cost of manufacturing armaments (Borsari, 2023). To the inattentive eye, European weaponry seems cutting edge, and technically it is, but it is also coming with significant economic demands (Borsari, 2023). Producing tanks in Europe remains problematic due to prohibitive costs compared to global competitors and a lack of unified standards across member states (Borsari, 2023). 

Heavy weaponry such as tanks, submarines, or carriers requires specialized training and maintenance to be operational. Therefore, a tank produced in Poland is not easily operated in Germany without specialized training (Navarra, 2024).

This creates a paradox in Europe, where different chains of production and procurement can be operated by their respective countries, but hardly by members of the same military alliance and customary union, despite the multiple declarations of shared security interests by European states.

Many efforts have been made by the EU and European states to build up a common security apparatus detached from overseas interests, such as the idea of a European Army, and the ReArm EU Plan. However, these commitments still fall short of the challenges that Europe faces. 

According to the German Military Chief, Carsten Breuer, there is concrete evidence that Russia will try to test NATO on Article 5, threatening attacks on Baltic states within 5 years (Gardner, 2025). This may sound absurd to some, but the Russian intelligence does not believe that NATO may realistically trigger Article 5 in defense of the small Baltic republics in case it decides to invade them again, especially if using the tactic of sending troops without distinguishable Russian allegiance (Gardner, 2025). Perceived disunity in the alliance, brought by mixed relations between the USA and the other members of the NATO alliance since the election of Donald Trump, has probably brought the Russian elite to draw such conclusions (Jevaretnam, 2025). Moreover, Russia’s propagandists, well entrenched in European politics, have polluted European political debates regarding support for other members of the alliance (Savoia and Ntousas, 2024). Among various recent developments, notable examples include the 2025 Romanian elections, the increased visibility of pro-Russia groups in Italy, and the growing support for AfD in Germany (Savoia and Ntousas, 2024).

Photo by Markus Spiske on Unsplash

This distrust towards the willingness of the alliance to act upon its fundamentals has prompted the EU to further its security policy, but more issues lie ahead. The EU’s lack of a unified and up-to-date security network, without the USA, would take a long time to become able to counter Russia.

Why did the EU make itself so vulnerable?

The question often sparks hot debates and opinions, but the main reason is to be traced in the Berlin Plus Agreement of 2002, stipulated between the EU and NATO (Hofmann, 2009). 

The Berlin Plus Agreement officially designated NATO as the EU’s primary security apparatus to prevent the duplication of defense institutions and networks between the two organizations. In practice, this has meant delegating much of Europe’s security architecture to NATO (Hofmann, 2009). 

As much as this system allowed for improving the efficiency of the European security network, the EU has, exposed itself to the vetoing power of non-EU states, such as the USA, Canada, and Türkiye, whose vote is necessary to reach unanimity in key decisions. This has severely impacted EU security, leaving it exposed to American interests. With the ‘America-first’ approach of foreign policy pursued by the current administration of the USA, the European security project is at risk.

What are the options for the EU?

Despite the increased investments in security, and efforts to align its foreign policy, the EU will need considerable time to close the gap with the industrial output of Russia. Keeping Putin engaged in Ukraine and eroding Russian resources may serve as a short-term solution, but it does a little to address the century-old problem of Russian imperial ambitions on the old continent.

As of today, a possible solution has been advanced, which is the extension of France’s nuclear umbrella onto the whole EU. Little details have been advanced, but a potential French nuclear umbrella would entail France deploying its nukes to other EU states, while retaining the final decision-making power to use them, resting in the French government (Sorg, 2025). As much as this option sounds appealing, nobody knows how such a system would work, and the French proposal has, for now, mostly remained in words, rather than any will to build such an umbrella. The French military has also had to face strong internal opposition from the far left and far right on the idea (Solletty, 2025).

Despite the problematic nature of the enlargement of a French nuclear umbrella, the idea of ‘the bomb’ appears to have returned from the Cold War era not as a tool of strategic posturing, but as the ultimate instrument of deterrence and defense (Lee and Nacht, 2020) Throughout history, several European countries have developed nuclear development programs, with some of them almost succeeding in the development of a nuclear arsenal. However, the Nuclear Non-Proliferation Treaty has largely brought these efforts to an end (Lee et al., 2020).

Nevertheless, states such as North Korea, Iran, and Libya have developed nuclear programs aimed at acquiring military capabilities. A potential European atomic arsenal would be an important deterrence mechanism, but several diplomatic obstacles are present, such as the aforementioned Berlin Agreement, and diplomatic issues with the USA. Nonetheless, most of the infrastructure is present on European soil to develop nuclear weapons, and an important and crucial factor at play would be the coordination of military programs between states (Lyon, 2010).

Enlargement as Europe’s Strategy

As much as the prospects for a unified military apparatus and shared arsenal, or nuclear weapons, seem objectives to aim for, the current reality of the EU is far from achieving them. What lies ahead for the Union’s foreign policy is the unyielding support for newborn states that emerged from the ashes of the Communist Bloc. Ukraine, Moldova, Albania, the Baltic Republics; taking Polish foreign policy as a model, the EU has enabled former parts of the Soviet Empire to express their sovereignty outside of Moscow’s leash (Asmus, 2008). This strategy has allowed the EU to expand, enlarging its market, promoting stable democratic governments eastwards, and freeing most of Europe from Russian power games on the continent (Asmus, 2008).

However, despite the recent support for Ukraine and Moldova, the EU appears to have taken a halt in this policy, with European institutions and governments now exhibiting an increasingly incoherent approach to integration (Kelmendi, 2024). The EU requires candidate members to solve territorial disputes and follow strict economic and political requirements that grant access to the bloc. Despite this, the requirements seem to be malleable. North Macedonia’s accession has been hindered by a rather minor topographic dispute regarding its name (Delauney, 2024). Cyprus entered the EU despite being divided by 2 different sovereign governmental entities, with Moldova and Ukraine cutting the line of long-standing candidates such as Türkiye and the Western Balkan Bloc (De Waal, Bechev, and Samurokov, 2024).

Photo by Christian Lue on Unsplash 

Unanimity, Disease of The EU

However, the issue of enlargement is tied to the overall problems of foreign policy and lack of common military projects, and is bound by the same long-standing issue, a unanimity-based vote in EU institutions. Due to the unanimous vote requirement, Hungary had the power to single-handedly hinder European sanctions towards Russia (Gavin and Vinocur, 2024). This system of decision-making slows EU policy, especially on foreign policy goals, due to their controversial nature.

As many European policy makers, such as Romano Prodi, affirm that solving the unanimity vote dilemma before enlargement, the issue of institutional reform becomes central and of utmost importance to guarantee the existence of the EU (Prodi, 2025). Unanimity vote will remain an issue also in the case the EU decides to overcome economic problems for achieving the 5% NATO spending target, through Mario Draghi’s proposal of a common European debt (Chivvis, 2010).

Overall, the current security issues faced by the EU must overcome two main challenges that need to be addressed as quickly as possible: the first being the deficit of its member states, and the second the reform of voting-based decision-making in European institutions.

Without addressing these very concrete obstacles, any speculation regarding strategic autonomy, the European Army, or the EU nuclear arsenal is nothing more than highly detailed fantasies.

Unfortunately, Europe tends to be the continent of never-ending emergencies — from the lack of a bailout system during the sovereign debt crisis, to the lack of intervention in the Yugoslav wars, and the response to the Russian annexation of Crimea. The lack of preparedness among its policy-makers has left the EU in a constant state of comfortable decision-making — one that prioritizes short-term goals, over the establishment of solid, long-term, focused institutions equipped with mechanisms to address security and diplomatic emergencies. A clear direction for European foreign policy remains urgently needed. In the past, the EU has demonstrated its capability to make such commitments, notably during its Eastward enlargements, and through the deployment of the EULEX mission in Kosovo (Chivvis, 2010). Continuing to delegate its security to NATO, the US, and other non-EU states is probably a riskier move than making the decisions that are needed today to safeguard European stability. Similarly, the EU promptly revisit the terms of the Berlin Plus Agreement to chart a new course for its security architecture.

 

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