Brussels, 15 October 2025 — The European Commission has moved swiftly to counter U.S. President Donald Trump’s threat of “trade punishment” against Spain, after Madrid rejected NATO’s new benchmark requiring members to spend 5% of GDP on defence. Spain is the only NATO member to openly oppose the target, which Trump has pressed as a condition for continued U.S. security guarantees.
Commission spokesperson Olof Gill stressed that “all EU countries are bound by a common commercial policy”, making it legally impossible for Washington to single out Spanish goods without provoking a collective EU response. “We will respond appropriately, as we always do, to any measures taken against one or more of our member states,” Gill said.
NATO Spending Dispute
Trump has repeatedly criticised European allies for what he calls “unbelievably disrespectful” underinvestment in defence. While most NATO members have agreed to raise spending to the 5% threshold, Spain has argued that such a target is economically unsustainable and risks undermining domestic priorities. Prime Minister Pedro Sánchez has defended Madrid’s position, saying Spain remains committed to NATO but will not “jeopardise social stability for arbitrary figures.”
Trade and Legal Ramifications
Analysts note that any attempt by Washington to impose higher tariffs specifically on Spanish exports would likely breach World Trade Organization rules and existing EU-U.S. trade agreements. Brussels has signalled it would be prepared to launch retaliatory measures or a WTO complaint if necessary.
The dispute comes at a sensitive moment in transatlantic relations, with ongoing negotiations over technology transfers, energy security, and agricultural trade. European officials fear that linking NATO obligations to trade penalties could set a dangerous precedent, blurring the line between security commitments and economic coercion.
Outlook
The Commission’s firm stance underscores the EU’s determination to act as a unified bloc in the face of external pressure. While Trump’s threat has rattled Spanish markets, Brussels’ intervention is intended to reassure both Madrid and investors that Spain will not face punitive tariffs alone.
The issue is expected to dominate discussions at the upcoming EU-U.S. Trade and Security Council, where European leaders will press Washington to decouple defence burden-sharing from trade disputes.
In summary: Spain’s refusal to meet NATO’s 5% defence spending target has triggered a sharp warning from Trump, but the EU has vowed to defend its member state, signalling readiness for a collective response if tariffs are imposed.
Sources: European Commission statements; El País; Politico; Reuters.
