Trudeau was warned again over his failure to meet NATO's spending targets

One of the leading business advocacy groups in Canada has warned the government is risking diplomatic isolation if Ottawa does not come up with a plan to meet the spending threshold it agreed to as a NATO member state. 

Canada is one of the 32 member states of the defensive alliance but it is the only nation that has yet to reveal a plan on how it will meet NATO’s 2% defence spending threshold according to CBC News, and this is a problem. 

The Business Council of Canada warned Prime Minister Justin Trudeau that his inaction on this policy point could have disastrous consequences for the country in a letter published on its website on June 12th. 

The council cautioned that Canada could be singled out during an upcoming meeting of the defensive alliance in Washington that will see NATO’s members celebrate the 75th anniversary of the alliance and discuss its future. 

"The consequences that would result from this diplomatic isolation, in terms of both our security and economic partnerships, will have broad ramifications for all Canadians," the Business Council of Canada warned in a letter dated June 7th. 

"Fortunately, it is not too late. Your government could still make a public statement prior to the summit that it will review and revise its defence spending plans to achieve the full two percent by 2029-30,” the council’s warning to Trudeau added. 

The council stated that it was vital Canada cooperate with its allies to defend the country’s borders, interests, and way of life—something the council noted could be jeopardized by not meeting NATO’s 2% spending threshold. 

"If we, as a country, fail to make this benchmark level of investment in defence, as successive Canadian governments including yours have promised, we will put lives and livelihoods at risk,” the Business Council of Canada’s letter stated. 

On April 8th, the federal government revealed Canada’s new national defence strategy, which added billions to the country’s defence spending over the next five years but was not enough to hit 2% of the nation’s Gross Domestic Product (GDP). 

NATO member states have agreed several times over the alliance's history that member states should spend at least 2% of their GDP on defence spending in order to show the alliance's political resolve and increase its defensive readiness according to NATO’s website.  

"In 2024, 23 Allies are expected to meet or exceed the target of investing at least 2% of GDP in defence, compared to only three Allies in 2014,” NATO explained on its website. However, Canada is not one of those allies, nor is Ottawa planning to be anytime soon. 

The federal government’s 'Our North, Strong and Free’ national defence policy will see an additional $8.1 billion in new military spending added over the next five years and an increase of $73 billion over two decades according to the Government of Canada. 

"This is a significant increase in defence spending and is a major step forward in our effort to reach two percent of GDP, as agreed by NATO members at the Vilnius Summit in 2023," the 'Our North, Strong and Free’ policy document’s executive summary noted. 

Unfortunately for Ottawa, its new spending isn’t enough to meet NATO’s 2% spending threshold. The increased spending will only have Canada reaching 1.76% of its GDP by 2029-30, which is an issue some of its allies have started to express concern about. 

"This is an area where we have been called out," the President and Chief Executive Officer of the Business Council of Canada Goldy Hyder explained to CBC News. "It used to be called out quietly in Washington. Now, it's being done very publicly."

In May 2024, nearly a quarter of the U.S. The Senate sent a bi-partisan letter to Trudeau that was critical of the nation’s defence spending and called out the government’s inability to meet the obligations it has agreed to achieve as a NATO member state. 

"We are concerned and profoundly disappointed… "Canada will fail to meet its obligations to the Alliance, to the detriment of all NATO Allies and the free world, without immediate and meaningful action to increase defence spending,” the letter explained. 

"Later this year, when the United States hosts the 2024 NATO Summit to lay out priorities for the upcoming year, we will expect your government and every NATO member that has not met the two per cent defence spending threshold to have a plan to reach this benchmark as soon as possible," said the letter added. 

Never miss a story! Click here to follow The Daily Digest.