Korea faces pressure as NATO raises defense spending target to 5% of GDP

 

Dutch Prime Minister Dick Schoof, flanked by NATO Secretary General Mark Rutte U.S. President Donald Trump, British Prime Minister Keir Starmer and NATO Deputy Secretary General Radmila Shekerinska, speaks during a North Atlantic Council meeting during a NATO summit in The Hague, the Netherlands, June 25. [REUTERS/YONHAP]

 
Following a new NATO agreement to raise defense spending to 5 percent of members' GDP by 2035, pressure is mounting on U.S. allies in Asia, including Korea, to follow suit. The move is seen as part of a broader push by U.S. President Donald Trump, who has long pressed allies to increase their military budgets.
 
On June 25 in the Netherlands, NATO’s 32 member states adopted a joint statement in The Hague committing to allocate at least 3.5 percent of GDP annually to direct military expenditures, with an additional 1.5 percent to be spent on indirect security-related costs. The agreement also reaffirmed Article 5 of the NATO treaty, which states that an attack on one member is an attack on all.
 

Related Article

• In his sole full day at the NATO summit, Trump faces an alliance further shaped to his liking

• NATO leaders are set to agree on a historic defense spending pledge, but the hike won't apply to all

• Practical move or lost opportunity? Lawmakers, experts debate Lee's snub of NATO summit.

• President to skip NATO summit, manage economy at home amid Middle East tensions

Since 2014, the NATO defense spending target has stood at 2 percent of members' GDP. Tripling that goal will require a significant reallocation of national budgets, including cuts to welfare programs and other domestic spending. Major NATO members such as Germany, France and Britain have outlined concrete plans to meet the target, while Spain has opposed the increase. In response, President Trump threatened to double tariffs on Spanish imports, indicating his intention to tie security contributions to trade negotiations.
 
Korea now finds itself in a challenging position. The country’s 2025 defense budget is approximately 61.2 trillion won ($45.2 billion), or 2.3 percent of the GDP. Raising it to 5 percent would require an additional 70 trillion won based on this year’s economic output — a burden that could strain public finances. Yet, as NATO’s experience suggests, avoiding U.S. pressure entirely may be difficult.
 
To minimize the burden, Korea must pursue a multifaceted strategy. First, it is inevitable that defense cost-sharing negotiations will need to be linked with trade and tariff discussions. Korea could also use this moment to strengthen its self-reliant defense capabilities by reallocating increases in defense spending toward force enhancement and strategic asset development. Expanding security infrastructure and investing in military modernization could turn this pressure into an opportunity.
 

A view of the Defense Acquisition Program Administration's booth at the biennial International Defence Exhibition and Conference, the Middle East's largest defense exhibition, in Abu Dhabi in the United Arab Emirates on Feb. 17. [YONHAP]

 
Korea’s defense industry might also benefit. As NATO members ramp up military spending, opportunities for exports from Korea’s defense sector could expand. The government should consider ways to tie increased defense funding to long-term industrial competitiveness.
 
Importantly, NATO’s new target carries no legal force. A shift in U.S. domestic politics — particularly if Republicans lose influence in the 2026 midterms — could weaken Trump’s hand. For now, Korea must monitor the evolving U.S. stance while crafting a flexible and pragmatic response grounded in national interest. A diplomatic approach rooted in practicality will be essential.


Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.