Trump Slams Spain with Tariff Threat over NATO Snub

Written by Matthew Peterson.

In a dramatic escalation at the NATO summit in The Hague, President Donald Trump singled out Spain as the only member nation refusing to increase defense spending, threatening to impose steep tariffs on its trade. Spain’s socialist government, led by Prime Minister Pedro Sanchez, secured an exemption from NATO’s new 5% GDP defense spending target, opting to maintain its current 1.3% allocation. Trump’s blunt response underscored his frustration with what he perceives as Spain’s attempt to shirk its responsibilities, setting the stage for a contentious transatlantic standoff.

Spain’s Defiance of NATO Commitments

Spain’s decision to resist NATO’s heightened defense spending expectations has positioned it as an outlier among the alliance’s 31 members. While most nations agreed to the 5% GDP target to bolster collective security amid global tensions, Spain’s expenditure remains the lowest in NATO, at just 1.3% of GDP in 2024. This figure starkly contrasts with the United States’ 3.5% and other European allies like Poland, which spends 4.1%. The Spanish government argues that its military contributions, including participation in NATO missions, are sufficient despite the lower budget.

Prime Minister Pedro Sanchez, facing domestic political turmoil, has defended Spain’s stance, emphasizing a “realistic” defense budget that aligns with the country’s social priorities. However, Spain’s exemption has drawn sharp criticism from allies who view it as undermining NATO’s unity. The nation’s military capabilities, while modern in some areas, suffer from underinvestment in critical areas like naval modernization and cyber defense, according to a 2024 European Defence Agency report. This gap leaves Spain vulnerable and reliant on allies for protection.

Trump’s Tariff Threat and Summit Showdown

At the summit’s closing press conference, President Trump seized the opportunity to address Spain’s refusal directly, dismissing questions from Spanish journalists with a mix of humor and resolve. He warned that Spain’s economy, which has shown resilience with a 2.5% GDP growth rate in 2024, could face severe repercussions from doubled tariffs on its exports to the United States. “They’ll pay more this way,” Trump stated, signaling his intent to negotiate personally with Spanish leadership to enforce compliance.

Trump’s remarks reflect a broader strategy of leveraging trade as a tool to enforce NATO obligations. The United States, which accounts for nearly 70% of NATO’s total defense spending, has long pressed European allies to contribute more equitably. Spain’s exports to the U.S., including automobiles, olive oil, and wine, generated $20 billion in 2024, making it vulnerable to tariff hikes. Such measures could disrupt Spain’s economic recovery and strain bilateral relations, especially given the lack of a direct meeting between Trump and Sanchez at the summit.

Political Context and Allied Reactions

Spain’s socialist government, grappling with corruption allegations and internal divisions, faces a delicate balancing act. Sanchez’s administration has prioritized social welfare programs, with 45% of the 2024 budget allocated to healthcare, education, and pensions. This focus limits fiscal space for defense increases, a stance that resonates with Spain’s left-leaning electorate but alienates NATO partners. Senator Marco Rubio, echoing Trump’s sentiments, labeled Spain “recalcitrant” and questioned the sustainability of its exemption, noting that Spain’s political challenges hinder its ability to meet alliance standards.

Other NATO members have expressed unease over Spain’s position. The United Kingdom and Germany, both exceeding 2.5% GDP on defense, have urged greater burden-sharing to counter threats from Russia and cyberattacks. A 2025 NATO report highlighted that underfunding by member states could weaken the alliance’s deterrence capabilities, particularly in the Mediterranean, where Spain plays a strategic role. The absence of dialogue between Trump and Sanchez at the summit further complicates efforts to resolve the dispute diplomatically.

Our Take

President Trump’s tariff threat against Spain underscores the growing tension within NATO over equitable defense contributions. Spain’s exemption, while politically expedient at home, risks isolating it from allies and exposing its economy to punitive trade measures. The socialist government’s insistence on maintaining a minimal defense budget overlooks the broader implications for NATO’s cohesion and Spain’s security. As global uncertainties mount, Spain must weigh the costs of its defiance against the benefits of strengthened alliance solidarity. Trump’s hardline approach, while divisive, may spur a broader reckoning on burden-sharing that could reshape NATO’s future.