US warns Czech defence cuts could leave Prague among NATO's lowest spenders

PRAGUE, March 5 (Reuters) - The Czech Republic may slip to the bottom of NATO's defence-spending ranks after Prime Minister Andrej Babis's government proposed a 2026 budget that trims core military funding, spurring a U.S. warning Prague may miss its own capability targets.

"At around 1.8% of GDP (gross domestic product), Czechia would risk being among the lowest spenders in the Alliance – and would be demonstrating negative momentum compared to peer NATO partners," U.S. Ambassador to Prague, Nicholas Merrick, told a security conference on Thursday, a document on the embassy website showed.

Babis, the populist ANO party chief who returned to power after an election last October, has refused to align budget plans with the military alliance's pledge to raise defence spending to 3.5% of GDP plus 1.5% on other defence-relevant investments over the next decade.

Babis's cabinet cut core defence spending by 21 billion crowns ($998.95 million) in the 2026 budget draft from a previous proposal by the outgoing centre-right cabinet.

'NOT MEETING CAPABILITY TARGETS'

This would put core defence spending at below 1.8%, marginally lower than last year in relative terms, and at 2.07% including funds for road projects and strategic material reserves that the government identifies as defence but experts say may not be recognised as such by NATO.

"This level of spending means  Czechia  risks not meeting  its  self-identified capability targets. If Czechia fails to fulfil its commitments, it impacts the entire Alliance," he said.

The United States, under President Donald Trump, has been pushing allies in Europe to beef up their armed forces after decades of low investments.

The previous Czech government had pledged to raise defence spending by at least 0.2 percentage point per year, rising to 3.0% in 2030.

Babis, whose first steps in office included subsidising energy prices, said last week the country was "certainly not" on the path to raising core defence spending to the 3.5% target.

Politically, Babis is a supporter of Trump, and the government has also backed U.S. strikes on Iran.

The 2026 budget is being debate by parliament, where the opposition has proposed to raise funding for defence.

($1 = 21.0220 Czech crowns)