New Zealand tells the United States it cannot quickly increase defence spending to match higher expectations, Finance Minister Nicola Willis says. Speaking after comments by US Defence Secretary Pete Hegseth at an Asia security forum in Singapore, Willis argues New Zealand lacks “fiscal headroom,” saying the country does not have “billions under the couch” that would allow it to lift spending to higher levels immediately.
Hegseth said New Zealand’s plan to raise defence spending to 2% of gross domestic product is insufficient and characterized this approach as “freeloading.” He suggested that countries should instead aim for targets as high as 3.5%.
Willis responded that such an increase would be “extremely challenging,” reflecting New Zealand’s budget constraints rather than a change in commitment. The exchange highlights differing views between the two countries on the level of defence investment needed and the feasibility of meeting higher spending benchmarks.
