The Fiscal Implications of Meeting the NATO Military Spending Target
Published on October 30, 2024
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This report examines the fiscal implications of Canada’s recent commitment to meet NATO's military spending target of 2% of GDP by 2032.
Communications
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Based on our analysis and independent GDP projections, the government’s latest military spending forecast reaches only 1.58% of GDP by 2029-30, which means military spending will have to be increased by 0.42 percentage points of GDP within the following three years to meet the target by 2032-33.
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To meet Canada’s NATO spending commitment, military expenditures need to rise to $81.9 billion by 2032-33, which is nearly double the $41 billion projected for 2024-25.
Yves
Giroux
Parliamentary Budget Officer
Parliamentary Budget Officer