Portugal Rejects EU Army and Backs NATO — Military Budget Reaches Two-Per-Cent Target Four Years Early

Portugal Rejects EU Army Plan, Backs NATO as Founding Member

Portugal has firmly distanced itself from calls for a European army, with Defence Minister Nuno Melo telling a parliamentary committee that the country opposes creating a separate EU military force. The position puts Lisbon at odds with neighbouring Spain, which has been among the loudest advocates for a joint European deterrent.

Melo's remarks, reported by Reuters on 15 April, underscore Portugal's enduring commitment to the Atlantic alliance. As a founding NATO member, Portugal views the United States as a "fundamental transatlantic partner" — a stance that carries particular weight at a moment when several European governments are openly questioning the reliability of American security guarantees under President Donald Trump.

Diverging Paths on European Security

The contrast with Spain is sharp. Madrid has pushed the European Union to accelerate towards a common military structure, framing it as a necessary hedge against uncertainty over Washington's commitment to European security. Portugal, by contrast, has opted to deepen its investment in existing frameworks rather than pursue new institutional architecture.

That view aligns with NATO Secretary-General Mark Rutte, who has dismissed the European army concept outright, arguing that building a parallel structure would cost more than the alliance's own ambitious five per cent of GDP spending target — itself a figure Spain has publicly rejected as excessive. Madrid has indicated it considers 2.1 per cent of GDP sufficient, even as it reached the two per cent threshold in 2025 with spending of EUR 33.5 billion, a 44.5 per cent increase on the prior year.

Military Spending Hits Two Per Cent of GDP

Portugal's own spending trajectory is striking. Military expenditure reached EUR 6.12 billion in 2025, equivalent to two per cent of GDP — four years ahead of the schedule Lisbon had originally committed to with NATO. In 2024, spending stood at around EUR 4.5 billion, or 1.58 per cent of GDP, making last year's jump one of the most significant single-year increases in the country's recent military history.

The investment is not merely symbolic. Portugal has applied for EUR 5.8 billion in low-cost EU loans under the Security Action for Europe (SAFE) programme, a EUR 150 billion initiative designed to reinforce member states' capabilities. The funds are earmarked for the acquisition of frigates, armoured vehicles, satellites and drones, with delivery targeted by 2030.

What This Means for Investors and Residents

For English-speaking expats and investors with interests in Portugal, the picture is one of a small but strategically conscious country navigating a rapidly shifting security landscape. Lisbon is spending more, procuring more, and doing so within established multilateral channels — without the political risk of championing untested EU military structures that could complicate relations with Washington.

The SAFE programme applications, in particular, signal that Portugal intends to modernise its armed forces substantially over the next four years, which is likely to generate procurement contracts and industrial partnerships of interest to investors. The government's preference for the NATO framework over an EU army also suggests continuity in foreign and security policy, regardless of domestic political shifts.

Portugal's position may be cautious, but in an era of European strategic uncertainty, caution paired with credible investment is increasingly a distinguishing virtue.

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