Germany, US to Equalize NATO Budget Contributions, Report Says ahead of Pact’s 70th Birthday

Germany, US to Equalize NATO Budget Contributions, Report Says ahead of Pact’s 70th Birthday

America is going to save EUR 120 million as a result of the readjustment.

Germany is going to up its contribution to the NATO budget, while the United States is going to reduce its own, with the two ending up contributing the same amount, a report says ahead of the 70th anniversary since the founding of the North Atlantic alliance.

The contributions of Germany and the United States to NATO’s budget are thus going to be equalized as of 2021, according to a report by German press agency DPA based on unnamed sources, as cited by DW.

While NATO’s own budget is not huge compared with the defense spending of its members, the report says NATO officials are hoping the largely symbolic readjustment of burden sharing would help lower the transatlantic tensions in the pact.

Presently, NATO’s budget is EUR 2.12 billion. In 2019, the US contributed 22.1%, or EUR 470 million, while Germany, the second largest contributor, paid 14.8%, or EUR 313 million.

With the readjustment, Germany’s contribution will go up by EUR 33 million, reaching 16.35% as of 2021, will the US contribution will be decreased to amount to the same share, 16.35%.

Thus, the US will save about EUR 120 million, which are said to be used for other programs, for example aiding Alliance partners such as Georgia and Ukraine.

At present, each NATO member state’s contribution to the Pact’s budget is proportional to its GDP. Only the contribution of the United States has been capped since otherwise it would have to be responsible for half of the budget of the alliance.

NATO’s budget is used for funding the organization’s headquarters in Brussels as well as for investing in infrastructure and other projects.

Since coming to office in 2017, US President Donald Trump has embarked on a course of radical criticism of America’s NATO allies with respect to their substantially lower defense spending as a percentage of their GDP.

Trump has been outspoken in demanding that all NATO members meet their target of spending at least 2% of their GDP on defense by 2024, a pledge agreed upon by the entire pact back in 2014.

German Chancellor Angela Merkel and Defense Minister Annegret-Kramp Karrenbauer, however, have recently made it clear that Germany will fail to reach the 2% benchmark by 2024 but would keep upping its defense spending, reaching the target by the “early 2030s” instead.

Next week, NATO is holding a summit in London marking the 70th anniversary since its founding.

(Banner image: Jens Stoltenberg on Twitter)

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