Spain exempt from Nato's 5pc spending target

Spain will be exempt from spending 5 per cent of its GDP on defence after striking a deal with Nato, the country's prime minister said.
Speaking ahead of this week's Nato summit in The Hague, Pedro Sanchez said he had achieved a 'success' for his country by securing an exception from the new spending target, which had been billed as a strict requirement for all 32 Nato members.
It puts Madrid at odds with Donald Trump, the US president, who has called for a significant increase in defence spending and cast doubt on his willingness to defend Nato allies 'if they don't pay'.
Mr Sanchez said Spain could fulfil its existing commitments to Nato with a defence budget of 2.1 per cent of GDP.
'We fully respect the legitimate desire of other countries to increase their defence investment, but we are not going to do so,' the Spanish prime minister said in a televised address on Sunday.
Mark Rutte, the Nato secretary general, warned members earlier this month that they must commit to spending 5 per cent on defence spending or 'better learn to speak Russian'. It came after he had warned that Vladimir Putin could attack Nato by 2030.
According to Nato estimates, Spain spent only 1.24 per cent of GDP on defence last year.
In April, Mr Sanchez pledged to increase defence spending to 2 per cent by the end of this year.
Target in doubt
But Spain's Left-wing government is divided on the need to increase military spending and a think-tank linked to the administration has cast doubt on whether the 2 per cent target for this year is feasible.
Mr Sanchez wrote to Mr Rutte last week to say that 5 per cent of GDP was 'unreasonable and counter-productive', arguing that such a commitment would impact the country's social spending and undermine EU plans for technological growth.
On Sunday, it emerged that the agreement Nato leaders will sign at The Hague on Wednesday has been altered to accommodate Spain's objections.
The text on the spending pledge has been changed from 'we commit' to 'allies commit', allowing Mr Sanchez to claim the commitment would not apply to Spain.
Under the plan, countries are meant to reach 5 per cent of GDP by boosting their core defence spending goal from 2 per cent to 3.5 per cent, and adding a further 1.5 per cent on related items such as cyber security and adapting roads and bridges for military vehicles.
Mr Sanchez said that Spain needs only to spend 2.1 per cent of GDP to meet its Nato capability targets – the personnel, equipment and infrastructure requirements set by the alliance
The announcement comes at a time of political difficulty for Mr Sanchez, who is under enormous pressure over a corruption scandal within his Socialist party.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

The Guardian

26 minutes ago

• The Guardian

Revolut CEO ‘could get multibillion-dollar windfall if its value passes $150bn'

Revolut's chief executive and founder Nik Storonsky could be in line for a multibillion-dollar fortune after he reportedly negotiated an Elon Musk-style deal that hinges on him pushing the fintech company's valuation past $150bn (£112bn). The former Lehman Brothers trader, who established Revolut in 2015, is said to have secured a lucrative deal that hinges on the company nearly tripling in value, having last been estimated at $45bn. The deal, which would pay out in stages, would offer Storonsky additional shares in Revolut that could eventually be equal to a further 10% stake in the online banking and finance firm. The Financial Times reported that the deal was arranged in the lead-up to Revolut's bumper funding round in 2021, which secured its position as the most valuable UK fintech company on record at $33bn. It is now the most valuable private fintech company in Europe. Revolut's latest annual report revealed that Storonsky already owns more than 25% of the business through direct and indirect shareholdings, after a reorganisation of its ownership structure. Storonsky was previously listed as a person of significant control, but no individual was listed as owning more than a quarter of the company. The arrangement is said to echo a pay deal set up for Tesla founder Musk in 2017, which offered Musk 12 different tranches of stock options if the electric car manufacturer hit certain financial and market targets. While the deal passed in shareholder vote in 2018, it faced opposition from prominent investors including Norway's sovereign wealth fund and the California state teachers' retirement system. One Tesla investor has since taken Musk to court over the deal, claiming the board had been misled and the package was unfair. A judge ruled last December that Musk was not entitled to receive the $56bn compensation package. Revolut declined to comment on Storonsky's pay arrangement. The fintech company originally launched as a pre-paid card focused on free currency exchange for customers. It has since grown to more than 10,000 staff, serving customers in more than 36 countries, with more than 50 products and services. As well as money transfers, it offers home rentals, buy now, pay later credit, wage advance, e-sims for mobile data plans and crypto trading. Its annual report in April showed Revolut more than doubled its annual profits in 2024, jumping nearly 150% to £1bn, thanks to a rise in subscriptions, and revenues from its wealth and crypto trading divisions. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Investors are waiting for Revolut to launch its much-anticipated stock market flotation. UK politicians and City bankers are desperate to convince Storonsky that London should host Revolut's primary listing. Revolut finally secured a UK banking licence, with restrictions, in 2024 after a rare three-year wait. The challenge, in part, was convincing regulators that Revolut had addressed a number of accounting issues and EU regulatory breaches, as well as reputational concerns, including an aggressive corporate culture. The UK's Financial Conduct Authority also reportedly investigated the business in 2016 after a whistleblower claimed it was failing to conduct adequate money-laundering checks or to properly flag suspect payments. That investigation was closed in 2017. The fintech company is hoping to gain full approval from UK regulators this year.

Times

27 minutes ago

• Times

Spectris recommends £3.8 billion takeover offer from Advent

A FTSE 250 instrumentation and testing group is at the centre of a possible bidding war after backing a £3.8 billion takeover offer for the company from an American private equity firm. Spectris has recommended that shareholders accept a cash offer of £37.63 per share from Advent International as a number of London-listed technology businesses attract interest from American investors. Yet, KKR, a rival American investment firm, has raised the prospect of making a second offer for the company, after first submitting a bid proposal on June 2. Advent International's bid for the London-based group represents a premium of 85 per cent to its closing price the day before the deal was announced. Andrew Heath, chief executive of Spectris, said the offer 'recognises the quality of Spectris, our talented people, and our strong growth prospect'. • Business live: follow for the latest news on markets, companies and the economy KKR responded to the deal by stating it 'notes the announcement made today by Spectris regarding a firm offer by Advent International' and that the firm 'encourages shareholders to take no action with regards to the Advent offer'. In the statement, the private equity firm said: 'KKR has been engaging constructively with the board of Spectris since submitting its first proposal to acquire the entire issued and to-be-issued share capital of Spectris on 2 June 2025. 'Whilst no revised proposal has been made to the board of Spectris, KKR confirms that it is actively engaged in the advanced stages of due diligence and arranging financing commitments.' Spectris is an industrial technology specialist and its shares were trading at more than £40 in late 2021. Yet, the group's market valuation has suffered in recent years owing to a decline in revenues and profits and the market volatility prompted by trade war concerns. Its shares have fallen as low as £15. The stock was up by 486p, or 14.81 per cent, to £37.84 on Monday morning. The London market has seen a flurry of bid interest from America in recent weeks. Oxford Ionics, a quantum computing start-up, has agreed to a $1 billion offer from IonQ, a larger US company, and Alphawave IP Group, the manufacturer of high-speed wire and chips, has recommended a £1.8 billion acquisition by Qualcomm, a peer based in California.

Reuters

27 minutes ago

• Reuters

Greenpeace joins protests against gala Bezos wedding in Venice

VENICE, Italy, June 23 (Reuters) - Global environmental lobby Greenpeace added its voice on Monday to protests against this week's celebrity wedding in Venice between American tech billionaire Jeff Bezos and journalist Laura Sanchez. The event, expected to attract some 200 guests including U.S. President Donald Trump's daughter Ivanka and son-in-law Jared Kushner, as well as scores of stars from film, fashion and business, has been dubbed "the wedding of the century". But some locals see the celebration as the latest sign of the brash commodification of a beautiful but fragile city that has long been overrun with tourism while steadily depopulating. Activists from Greenpeace Italy and UK group "Everyone hates Elon" (Musk) unfolded a giant banner in central St Mark's Square with a picture of Bezos laughing and a sign reading: "If you can rent Venice for your wedding you can pay more tax." Local police arrived to talk to activists and check their identification documents, before they rolled up their banner. "The problem is not the wedding, the problem is the system. We think that one big billionaire can't rent a city for his pleasure," Simona Abbate, one of the protesters, told Reuters. Mayor Luigi Brugnaro and regional governor Luca Zaia have defended the wedding, arguing that it will bring an economic windfall to local businesses, including the motor boats and gondolas that operate its myriad canals. Zaia said the celebrations were expected to cost 20-30 million euros ($23-$34 million). Bezos will also make sizable charity donations, including a million euros for Corila, an academic consortium that studies Venice's lagoon ecosystem, Italy's Corriere della Sera newspaper and the ANSA news agency reported on Sunday. Earlier this month, anti-Bezos banners were hung from St Mark's bell tower and from the famed Rialto bridge, while locals threatened peaceful blockades against the event, saying Venice needed public services and housing, not VIPs and over-tourism. The exact dates and locations of the glitzy nuptials are being kept confidential, but celebrations are expected to play out over three days, most likely around June 26-28. ($1 = 0.8722 euros)