OTTAWA — For the first time since the end of the Cold War, Canada is spending roughly two per cent of its GDP on national defence — a key NATO alliance commitment Ottawa previously failed to meet.
NATO accounting estimates released Thursday suggest Prime Minister Mark Carney’s government met the key spending benchmark for 2025 by shelling out just over $63 billion.
Canada has come under pressure in recent years from its allies — and especially from the U.S. — to dramatically ramp up its military spending.
NATO Secretary-General Mark Rutte said every alliance member has met the spending target for the first time — all because of U.S. President Donald Trump’s rhetoric about free riders in the alliance.
“I don’t believe that without the present American administration the whole of NATO would have been meeting the two per cent at the end of 2025,” Rutte told reporters at a press conference in Brussels Thursday.
“Big economies like Spain and Italy and Belgium and Canada were far from the two per cent.”
Rutte said that for too long, Europe and Canada were “over-reliant on U.S. military might.”
Carney campaigned during the Liberal leadership race on setting an earlier deadline for meeting the NATO target — 2030, two years earlier than the target date set by Justin Trudeau’s government.
Carney abruptly announced last summer his government would meet it immediately, moving up the schedule by years.
Not that long ago, federal politicians spoke about the two per cent target as if it were almost out of reach.
Former defence minister Bill Blair said he wouldn’t have been able to get all of that money out the door in a year — even if the finance department gave it to him.
“Quite frankly, if the finance department had come to me and said ‘OK Bill, you can make two per cent this year, here’s $14 billion,’ there was no way to actually spend that,” Blair said after a military change-of-command ceremony in 2024.
“I couldn’t acquire the capabilities that the Canadian Armed Forces was identifying that quickly.”
At a separate event that year, Blair said it was “really hard” to convince his cabinet colleagues and Canadians that this “magical” spending level was a “worthy goal” at a time when affordability and housing were dominating the political agenda.
In July 2024, Trudeau dismissed the alliance target as a “crass mathematical calculation” that “makes for easy headlines and accounting practices but don’t actually make us automatically safer.”
At the 2014 NATO Summit in Wales, Ottawa committed to its allies that it would boost defence spending to two per cent within a decade, after falling to the back of the pack in the 32-member alliance.
The issue is not a new one. U.S. politicians have made headlines since the 1970s by accusing Canada of being a free rider on defence.
But the situation really started to change when Canada fell under sustained pressure from U.S. political figures to boost defence spending.
In 2023, a Pentagon document leaked to the Washington Post revealed Trudeau had told U.S. officials Canada would “never” meet the two per cent commitment.
Trump also has repeatedly warned NATO countries not to expect the U.S. to come to their aid if they don’t pay their share on defence.
Carney’s first federal budget laid out nearly $82 billion in defence spending over the coming years, and added an extra $9 billion to the fiscal tables last summer to achieve the two per cent goal.
Meeting the two per cent benchmark is only the first step in a long uphill climb to rearm Canada’s military — and to sustain such high military spending levels every year.
Carney also has committed to reaching the new NATO target — an even steeper spending level of five per cent of GDP — by 2035.
This report by The Canadian Press was first published March 26, 2026.
Kyle Duggan, The Canadian Press
