Czech Parliament Approves Budget: Defense Spending Falls Short of 2% of GDP Despite NATO Pressure

Fourth-Largest Deficit in History

The Chamber of Deputies approved the state budget for this year on Wednesday, March 11, 2026, with a deficit of 310 billion crowns — the fourth-largest deficit in the history of the Czech Republic. 103 deputies from the ruling coalition of ANO, SPD, and Motorists voted in favor of the proposal, while 88 opposition lawmakers voted against it. Total state revenues this year are expected to reach almost 2,118 billion crowns, while expenditures will exceed 2,428 billion crowns.

The budget's approval ended several weeks of provisional arrangements and delivered a clear message on the issue that dominated the entire debate: the Czech Republic will not reach NATO's 2% of GDP target for defense spending in 2026.

Defense Spending Frozen at 1.73% of GDP

The Ministry of Defense will receive 154.8 billion crowns this year, which corresponds to approximately 1.73% of gross domestic product. When drafting the budget, the ruling coalition cut more than 21 billion crowns from the originally planned expenditures for the defense ministry. The parliament rejected opposition proposals to restore these funds to the army.

The NATO alliance requires member states to spend at least 2% of GDP on defense. At last year's summit in The Hague, allies, under pressure from the Trump administration, adopted a more ambitious goal — 3.5% of GDP for key defense needs and another 1.5% for security expenditures, by 2035. Washington has long spoken of a target of 5% of GDP.

Washington Sounds the Alarm

US Ambassador to Prague Nicholas Merrick did not hide his disappointment. At a security conference in Prague, he stated: "If the Czech Republic does not fulfill its commitments, it will have an impact on the entire alliance." He also warned that with the approved budget, the Czech Republic would rank among the countries with the lowest defense spending in all of NATO and would show a negative trend compared to other allies.

The Bloomberg agency reported on direct pressure from the US even before the vote in parliament. Similar warnings were also voiced through other allied channels. President Petr Pavel, himself a former military commander, has repeatedly called on the government to fulfill the 2% commitment and described the approved budget as a step in the wrong direction.

Babiš: Citizens' Health is a Priority

Prime Minister Andrej Babiš rejected the criticism, saying that defense spending is "the maximum possible" in the current situation. He emphasized that his government inherited a deep deficit from its predecessors and must primarily finance healthcare. "Our priority is the health of our citizens, so that they live long lives," Babiš said.

The Prime Minister also rejected the idea that the Czech Republic was embarking on a path towards the 3.5% of GDP target agreed upon at the summit in The Hague. According to him, the government plans to gradually increase defense spending, but at a pace that corresponds to the possibilities of the state budget.

Czech Republic Among NATO's Weakest Contributors

The approved budget ranks the Czech Republic among the alliance's lowest contributors in relation to GDP. While many Central European countries — including Poland, which spends over 4% of GDP — are significantly increasing defense spending, Prague is moving in the opposite direction. Analysts warn that this stance could weaken the Czech Republic's position in negotiations within NATO and in bilateral relations with Washington, the cooling of which could have long-term security consequences.

The debate on defense is thus moving from the parliamentary benches to the field of transatlantic diplomacy — and the result will not be known until Babiš sits down again with President Trump or NATO commanders.