EVOLUTION OF MILITARY SPENDING IN ITALY - Francesco Mancini - ETHICA SOCIETAS-Rivista di scienze umane e sociali

Between NATO Obligations, Industrial Modernization, and Economic Sustainability

Abstract: The evolution of Italy’s military spending from the postwar period to the present shows a steady decline from 4.1% of GDP in 1952 to 1.06% in 2015, followed today by an exponential rise driven by the new target of 5% of GDP by 2035, set at the 2025 Hague summit. This decision imposes a significant increase in public expenditure on Italy to meet NATO standards. Despite recent statements by Minister Crosetto about reaching 2% by next year, doubts remain about the real sustainability of an increase that could push annual spending beyond €76 billion, with serious implications for public finances.

Keywords: #militaryspending #NATO #defense #ItalyGDP #budget2025 #foreignpolicy #HagueSummit2025 #Crosetto #Europeansecurity #stabilitypact #militaryinvestments #strategy #economy #geopolitics #francescomancini #ethicasocietas #ethicasocietasreview #humansciencesreview #socialsciencesreview #scientificreview #ethicasocietasupli

italian version

MILITARY SPENDING IN ITALIAN HISTORY

When NATO was founded with the Washington Treaty of 1949, postwar Italy spent 3.5% of its GDP on arms. Military expenditure rose for a few years, reaching 4.1% of GDP in 1952, and then steadily declined until its historical low in 2015, when it stood slightly above 1%. In the following years, spending increased modestly but only slightly exceeded 1.5% of GDP, remaining consistently below the 2% threshold required of all NATO members, as shown in the attached graph [data source: Osservatorio Conti Pubblici Italiani, Università Cattolica del Sacro Cuore, 26/06/2025].

From the 1960s onward, Italy’s military expenditure as a share of GDP never again exceeded 3%, continuing the downward trend that began in the early 1950s. However, until 1989 — the year the Berlin Wall fell — the ratio remained consistently above 2%, with only minor peaks in isolated years such as 1966, 1972, and 1987.

With the onset of the 1990s, the decline resumed steadily, reaching its historical low in 2015 with spending equal to 1.06% of GDP. Following the 2014 NATO Summit in Cardiff — where member states reaffirmed their commitment to allocate at least 2% of GDP to defense, further emphasized by the geopolitical shifts after the annexation of Crimea — Italy’s defense spending began to rise gradually.

In 2020, the ratio reached 1.6%, not due to an actual increase in military expenditure, but rather because of the GDP contraction caused by the Covid-19 pandemic. By 2024, Italy’s military spending stabilized around 1.5% of GDP, corresponding to a more precise estimate of 1.46%.

NEW EUROPEAN AND NATO DEFENSE SPENDING POLICIES

The new course of U.S. foreign policy under Trump’s second term, shaped by the nationalist Make America Great Again movement, has led to a significant economic and military disengagement from Europe. This shift has left European countries with the burden — and especially the cost — of defense, while simultaneously pressuring them, under threat of new tariffs, to purchase American weapons, effectively transforming an expenditure item into U.S. revenue.

At the NATO summit held in The Hague (Netherlands) on June 24–25, 2025, involving the heads of state and government of the thirty-two NATO members, partner countries, and the European Union, a new, ambitious, and costly defense spending goal was established: by 2035, each member nation must allocate 5% of GDP to defense — with at least 3.5% for “core military spending” and up to 1.5% for “defense and security-related spending.”

Thus, the previous NATO target of 2% — which Italy has not met since 1990 — has now been raised, further straining national budgets already under pressure to comply with the Stability Pact, suspended only during the pandemic. The measure is intended to address the Russian threat and compensate for reduced U.S. military spending in Europe.

ITALY’S NEW SPENDING LEVELS

In November, during a parliamentary hearing, Defense Minister Guido Crosetto stated that, thanks to new allocations in the national budget, Italy’s defense expenditure would rise to 1.6% of GDP for the 2025–2027 period.

However, in a more recent statement — likely following a reclassification of certain military spending items according to NATO criteria — Crosetto revised his estimate, declaring: “We have submitted our budget data to NATO today, certifying this achievement (the 2%). We are well aware that the requests to come at the June summit will make this only a starting point.”

It remains to be seen whether NATO will accept this reclassification, which includes certain spending categories in the official count of defense resources.

A HISTORICAL GAP FROM THE NEW TARGETS

Over the past seventy years, Italy’s military spending levels have remained significantly below NATO standards. While Italy has averaged around 1.5% of GDP, the new 3.5% target represents a substantial increase, with major economic and fiscal implications.

In concrete terms, based on Italy’s 2024 GDP, this would mean an increase from the current spending level of about €32 billion (according to NATO estimates) — up roughly 12% compared to 2024 and more than 60% compared to 2016 — to over €76 billion. This represents an increase of €44 billion, equivalent to about 57% of Italy’s public education budget.

Moreover, additional funds would be needed to meet the 1.5% goal for “defense and security-related spending,” which covers areas connected to but not strictly military, further expanding the overall financial requirements.