Norway cool on Trump’s demand for a massive defense spending increase

OSLO — Norway is one of the world’s richest countries, but isn’t signing up for U.S. President Donald Trump’s demand that NATO members increase their defense budgets to 5 percent of GDP.

“’I’m prepared for new discussions about targets. But I think you also have to note that among the 32 allies there will be different views on this and also different starting points. Not everyone is at 2 percent yet,” Norway’s Defense Minister Bjørn Arild Gram told POLITICO.

The alliance’s current target is that its 32 member countries spend at least 2 percent of GDP on their militaries.

It’s not that Norway isn’t spending more.

The country, which has a high Arctic border with Russia, has been steadily increasing its defense budget since 2014, when NATO set the 2-percent-of-GDP goal.

That year, Norway spent 1.54 percent of its GDP on its military, putting it in the middle of the pack among NATO allies.

This year the country aims to spend 2.16 percent of GDP on defense, having from 2024 to 2025 increased its military budget by 19.2 billion krone (€ 1.6 billion) to 110.1 billion krone.

“We are almost going to double our defense spending over the next couple of years,” Gram said, adding that the increase from last year had been Norway’s largest single increase since the “uplift of defense spending in the early 1950s due to the Korean War.”

But going from 2 percent to 5 percent is a huge jump for almost all alliance members, even the U.S., which currently spends 3.4 percent of GDP on its military.

“I think that this will also be a debate in the United States because they’re also far away from the 5 percent,” Gram said.

He argued that spending as a percentage of GDP “is not everything.”

“For Norway, the GDP varies a bit more than most countries because of the oil production and the prices,” Gram said.

He noted that the fossil fuel exporter’s economy shrank during the pandemic as oil and gas prices plummeted thanks to the global slowdown in economic activity. “In the pandemic years, we reached 2 percent [of GDP], but that was not because the defense budget increased that much. It was because of the fall in the GDP,” he said.

Despite that note of caution, Gram said Norway’s eventual goal is to increase its defense budget to 3 percent of the economy by the end of the decade.

A big driver of higher spending is the country’s massive new frigate procurement program. Norway aims to procure five or six of the anti-submarine warships, which come equipped with onboard helicopters.

“It’s such a huge procurement for us,” Gram said, citing a total cost of €20 billion to €30 billion. “This will be, in economic terms, the biggest procurement in modern Norwegian defense history … This is a huge thing.”

Norway has approached France, Germany, the United Kingdom and the United States to discuss a potential strategic partnership to build the vessels, and will finalize its decision later this year.