Finance

UK's Starmer confirms plan to boost defence spending to 2.5% of GDP

Published by Global Banking & Finance Review

Posted on December 18, 2024

2 min read

· Last updated: January 27, 2026

Add as preferred source on Google
UK's FTSE 100 and financial markets react to Russia's embassy statement on G7 loans to Ukraine - Global Banking & Finance Review
The image illustrates the UK's FTSE 100 index performance amid the controversy over G7 loans to Ukraine backed by frozen Russian assets. This reflects the ongoing financial tension and geopolitical implications discussed in the article.
Global Banking & Finance Awards 2026 — Call for Entries

LONDON (Reuters) - British Prime Minister Keir Starmer reiterated on Wednesday his Labour government's plan to increase defence spending to 2.5% of gross domestic product (GDP), after NATO called on

UK Plans to Raise Defence Spending to 2.5% of GDP

LONDON (Reuters) - British Prime Minister Keir Starmer reiterated on Wednesday his Labour government's plan to increase defence spending to 2.5% of gross domestic product (GDP), after NATO called on members to boost spending to meet threats from Russia.

In an interview with LBC radio, Starmer was asked whether Britain would be willing to increase defence spending to 3% of GDP, but the leader repeated his government's position that it would plot a route to spending 2.5%.

"The commitment we've made is to set out a path to 2.5%," he said. Starmer has said his government will set out that path next year.

Last week, NATO head Mark Rutte warned the U.S.-led alliance that it was not ready for the threats it would face from Russia in the coming years and called for a shift to a wartime mindset, with much higher defence spending beyond the 2% target.

U.S. President-elect Donald Trump has called on NATO members to boost defence spending to 3% of economic output. The alliance estimates 23 of its 32 members will meet its target of dedicating 2% of GDP to defence this year.

(Reporting by Elizabeth Piper, Editing by Paul Sandle)

Key Takeaways

  • UK plans to increase defence spending to 2.5% of GDP.
  • NATO urges members to boost defence budgets against Russian threats.
  • Keir Starmer confirms Labour's commitment to defence budget increase.
  • NATO head warns of unpreparedness for future threats.
  • 23 NATO members expected to meet 2% GDP defence target this year.

Frequently Asked Questions

What is the main topic?
The main topic is the UK's plan to increase defence spending to 2.5% of GDP in response to NATO's call for higher budgets.
Why is NATO calling for increased defence spending?
NATO is urging increased spending to prepare for potential threats from Russia in the coming years.
Who is Keir Starmer?
Keir Starmer is the British Prime Minister and leader of the Labour government.

Related Articles

More from Finance

Explore more articles in the Finance category