At the close of the Nato (North Atlantic Treaty Organisation) Summit 2025 in The Hague, alliance members made a landmark decision: All 32 nations agreed to raise defence spending to 5% of their gross domestic product (GDP) by 2035. The new pledge, up from the long-standing 2% benchmark, marks the most ambitious military investment target in the alliance’s history and reflects mounting security concerns across the Euro-Atlantic space. US President Donald Trump hailed the agreement as a “monumental win” for Washington, claiming that it corrected longstanding imbalances in Nato’s burden-sharing.
The summit declaration outlined that the 5% commitment will be split into two distinct categories. Around 3.5% of GDP will go toward traditional defence spending aligned with Nato capability targets, covering military hardware, force readiness, and interoperability. The remaining 1.5% will be directed toward emerging non-military threats — securing critical infrastructure, cyber defence, civil preparedness, innovation, and the defence industrial base.
Nato secretary-general Mark Rutte, hosting his first summit in the role, emphasised that this investment “will ensure we have the forces, capabilities, resources, infrastructure, and resilience needed to deter and defend in line with our three core tasks: deterrence and defence, crisis prevention and management, and cooperative security.”
Yet, despite the show of unity on funding, the summit exposed cracks beneath the surface. Several members, including Spain and Slovakia, pushed back on the timeline. Spain openly stated that it would not be able to meet the 5% target before 2035, while Slovakia argued that competing economic priorities such as improving living standards and reducing debt made the goal unrealistic.
France’s President Emmanuel Macron offered guarded support for the new defence goals but expressed concern about broader alliance coherence. Stressing that Russia remained Nato’s principal threat, Macron warned against allowing intra-alliance trade tensions to escalate. “We can’t say we’re going to spend more on defence and then start a trade war within Nato,” he said, alluding to new US tariffs on European goods. “It’s an aberration. It’s time we returned to the principle of trade peace among allies.” In a subtle rebuke of recent US actions, Macron added that he had raised this concern directly with President Trump. “We cannot build a stronger Europe within Nato while undermining our economic unity,” he said.
{{/usCountry}}France’s President Emmanuel Macron offered guarded support for the new defence goals but expressed concern about broader alliance coherence. Stressing that Russia remained Nato’s principal threat, Macron warned against allowing intra-alliance trade tensions to escalate. “We can’t say we’re going to spend more on defence and then start a trade war within Nato,” he said, alluding to new US tariffs on European goods. “It’s an aberration. It’s time we returned to the principle of trade peace among allies.” In a subtle rebuke of recent US actions, Macron added that he had raised this concern directly with President Trump. “We cannot build a stronger Europe within Nato while undermining our economic unity,” he said.
{{/usCountry}}Despite growing anxiety over global hotspots, the summit avoided direct mentions of several key geopolitical challenges. There was no formal communique on Russia, China, the Indo-Pacific, or flashpoints like Gaza and Iran. While leaders addressed some of these issues in sideline meetings, their omission from the official agenda raised eyebrows. German Chancellor Friedrich Merz acknowledged the shifting focus. Merz also lobbied the US for stronger economic measures against Moscow and added that there needs to be more economic pressure, especially “on those enabling Russia by buying its fossil fuels — namely China and India.”
Trump, for his part, maintained ambiguity on Nato’s Article 5 — its core clause of mutual defence. When asked during a bilateral with Dutch Prime Minister Dick Schoof whether he remained committed to Article 5, Trump responded: “I stand with it. That’s why I’m here.” This came just a day after he had publicly remarked there were “numerous definitions” of the clause, leading to unease among allies. He also made headlines with a controversial comment about the ongoing Israel-Iran tensions. He claimed both nations were “tired” and ready to “go home,” though he warned that the conflict could “perhaps soon” reignite. Is the US hands off or on in the Middle East?
In contrast to past summits, where unity against adversaries like Russia or growing concern over China’s Indo-Pacific ambitions dominated discussions, this year’s gathering seemed adrift in a sea of rising budgets but unclear strategic purpose. Is Nato marooned on an island of anxiety, preparing for unknown threats without a clear definition of who the enemy is?
This strategic ambiguity underscored a deeper issue — while Nato is now better funded, questions linger about what exactly it is preparing to confront. With global power dynamics in flux, and transatlantic relationships under increasing strain, the alliance is investing heavily in its future, but the direction of that future remains uncertain.
Gurjit Singh is a former ambassador to Germany, Indonesia, Ethiopia, Asean and the African Union. The views expressed are personal.