As a result, the officials added, it is possible that Rome will be forced to eat into other budgets to drum up fresh funds for defense. It might also initially hit the 2 percent target and then gradually trim that amount to focus on the “maintenance” of its armed forces.
But the official quoted above also emphasized that the creative accounting had been carefully designed to withstand legal scrutiny. While pressure will be “unavoidable,” the official added, Rome might be able to get away with spending only a small amount that is more in a “way the Americans like,” such as by buying American weapons systems, and spending relatively less on personnel and so-called dual-use goods, or goods that are also used for non-defense purposes.
Defense spending has become a major priority in Rome as Washington’s commitment to Europe becomes increasingly tenuous and United States President Donald Trump asks much higher spending from NATO allies. Last week, Prime Minister Giorgia Meloni included upping Italy’s defense outlays as part of her pitch to Trump for a revival of U.S.-European cooperation and a deal on reduced tariffs.
At the same time, the matter has become politically toxic. The broad push for rearmament in Europe has been hugely unpopular in Italy, which faces a new round of austerity as the government seeks to stabilize its finances. While Italy is one of the EU’s lowest spenders on defense, at only 1.49 percent of GDP last year, it is also among several EU countries under strict orders from Brussels to rein in its deficit after spending exploded during the pandemic.
The Commission has floated exempting up to 1.5 percent of GDP in new defense expenditures annually from deficit calculations. But last week, Giorgetti told Italian lawmakers that the government would not accept that option, instead including civil infrastructure in its calculations.
