Canada Surges Ahead in Military Spending, Closing Gap with US
Canada's military spending has been a topic of discussion for decades, with successive governments failing to meet their commitments. However, under Prime Minister Mark Carney, Canada's funding for defense surged to $63 billion in fiscal 2025-26.
This increase was partly due to pressure from the U.S., which had demanded that allies step up their spending. The move also aimed to pursue an industrial strategy that would help Canada's tariff-battered economy and reduce its reliance on foreign suppliers.
NATO uses two metrics to measure a country's defense commitment: military spending as a share of gross domestic product (GDP) and real core defense spending per capita. According to the alliance, Canada's spending now surpasses NATO's 2% goal line and is on track to meet its updated 3.5% core defense target for 2035.
A new analysis by NATO shows that in 2026, Canada's real per-capita defense spending was $1,146, up from $598 a decade ago. This represents a significant increase, with Canada closing the gap to just 46% of U.S. spending in 2026, up from 22% in 2014.