Canada's Military Spending to Reach Two Percent of GDP by 2023
Significant Increase in Defense Budget to Meet NATO Targets
Current Spending and Projections
According to figures released by NATO, the Canadian military budget for 2023 will be approximately 367 billion, representing an increase of 129% compared to its gross domestic product (GDP). This marks a significant step towards meeting the NATO benchmark of spending two percent of GDP on defense, which Canada has committed to achieve by 2023.
In 2021, Canada's military spending totaled 264.5 billion, marking a 13.6% increase from 2020. The budget for 2020, in turn, was 232.8 billion, reflecting a 3.96% rise from 2019. However, in 2019, the defense budget declined slightly by 1.47% compared to 2018, standing at 223.9 billion.
Department of National Defense Estimates
The Department of National Defense's (DND) Main Estimates for 2023-24 total 26.5 billion, with a combination of regular votes and statutory funding primarily related to employee benefit plans (approximately 17 billion). The estimates include:
- Vote 1 Operating: 17.9 billion
- Vote 5 Capital: 6.1 billion
Additionally, the DND has allocated 8 billion in new funding over five years, on top of planned increases associated with the "Strong, Secure, Engaged" defense strategy. This includes:
- 6.1 billion for continental defense commitments to allies
- Investments in equipment
- 1,005 million for modernizing the military justice system and promoting culture change
Meeting NATO Targets
To achieve the NATO target of spending two percent of GDP on defense, the Parliamentary Budget Office estimates that Canada will need to increase its annual military spending by an additional 13 billion to 18 billion (98-136 billion) over the next five years.
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