Canada under pressure by allies to boost military spending: ‘Show us the money’

At 1.29 per cent of GDP in 2022, Canada's defence spending as a percentage of GDP is about the same as it was in the late 1990s, according to NATO.

Canada is expected to boost military spending after a government review next month, but the increase is unlikely to comfort allies facing new threats and it could further undermine the country’s international military credibility, policy analysts said.

Canada’s lagging military investments are well known, but threats have grown more serious with Russia waging war in Ukraine on the NATO alliance’s doorstep and vast areas of the Arctic becoming more accessible because of climate change.

NATO Secretary General Jens Stoltenberg warned after a visit to the Canadian Arctic last August that Russia and China were forming a strategic partnership that challenged the Western military alliance’s values and interests.

At 1.29 per cent of GDP in 2022, Canada’s defence spending as a percentage of GDP is about the same as it was in the late 1990s, according to the North Atlantic Treaty Organization (NATO), and well below the 2 per cent target for its members. The 2022 average spending for all of NATO was 2.58 per cent of GDP.

Canada, a founding NATO member, is expected to pledge an increase in defense expenditure when it releases a broad assessment of military needs just before a July 11-13 NATO leaders summit in Lithuania. NATO is expected to push for even more spending during the summit.

“I’d be surprised if the defense review doesn’t disappoint,” said one former senior official in the defense department, who spoke on condition of anonymity.

In order to meet the NATO target, Canada would need to spend an additional $13 billion and $18 billion per year for five years, the parliamentary budget office estimated last year.

“We say nice things but do not invest,” said the former defense official, and allies now say: “Show us the money.”