Are we going NATO’s way?

The United States is asking its allies and partners in Europe and Asia to increase their defense spending to five percent of their gross domestic product (GDP).

In an alliance summit at The Hague on 25 June, NATO (Northern Alliance Treaty Organization) members — except for Spain — committed to spend 3.5 percent of their GDP on core defense such as troops and materiel, and 1.5 percent of GDP on other security investments as roads, ports and bridges for use by military vehicles and on cybersecurity and protecting energy pipelines.

This whopping increase, from the current two percent of GDP agreed upon by NATO 11 years ago in Wales, was reached after pressure from US President Donald Trump, and amid the raging war being waged by Russia against Ukraine that could very well spill over to other parts of Europe, particularly nations bordering those two countries.

And Asia, too should follow suit, contends Trump. At the Shangri-La Dialogue in Singapore last 31 May, his Defense Secretary, Pete Hegseth, said US allies in the Indo-Pacific should spend more on defense to deter China and North Korea.

This was followed up in June, with Pentagon Chief spokesperson and Senior Adviser Sean Parnell telling Nikkei: “European allies are now setting the global standard for our alliances, especially in Asia, which is five percent of GDP spending on defense.”

He stressed that “given the enormous military buildup of China, as well as North Korea’s ongoing nuclear and missile development, it is only common sense for Asia-Pacific allies to move rapidly to step up to match Europe’s pace and level of defense spending.”

Can US allies in Asia afford to spend five percent of their GDP on defense? Perhaps wealthier allies like Japan, Australia and South Korea could. Their defense expenditures could very well reach five percent by 2035 but it wouldn’t be without having to implement massive tax hikes or budget cuts. And governments will have to contend with the political backlash, Japan and South Korea being countries with strong pacifist movements.

What about developing countries like the Philippines? It would be nearly impossible for the Philippines to afford that, and if it does make an effort to accede to US wishes, it would be playing with fire.

Currently, the Philippine government’s defense spending comes to about 1.25 percent of GDP ($461.62 billion), or $5.770 billion. Compliance with the US five percent is equivalent to $23.81 billion, which is more than the total 2025 budget for health ($624.582 million) and education ($18.629 billion) combined ($19.253 billion).

Spending that much on defense could trigger fiscal instability and even a debt crisis. With about 15.5 percent of total Filipinos, per Philippine Statistics Authority data, living in poverty, slashing social services allocations for defense spending could be politically explosive.

For certain, increased defense spending could enhance deterrence and deepen partnerships, particularly at a time of rising tensions in the Indo-Pacific. But boosting current expenditures to a whopping five percent of GDP would have political, economic, and constitutional challenges (the Philippine Constitution mandates that education — not defense — receive the biggest share of the national budget).

Countries in this part of the world aligned with the US, the Philippines included, must think this matter through very carefully.

For instance, take the US rivalry with China. Is Trump’s urging of Asian allies to spend more for defense coming from a desire to see, say, ASEAN economies fortifying themselves against a superpower’s aggressive expansionist moves in the region? Or is this really all about Trump’s wanting Asian allies to fight his battles, and execute his — the US’ — moves to curb Chinese domination of the region?

Still, the fact remains that a strategic alliance with the US, for so long a traditional partner of the Philippines, is important. But giving in to its urging that a struggling economy like ours should spend a whopping five percent of GDP for defense — when there are a myriad of urgent needs begging for a share of the country’s scarce resources — can have serious consequences.

Perhaps, the smart play for the Philippines is to stall, negotiate, and not be pressured or bullied into making a drastic decision — at this time.