ROME — With a few hours to spare before Italian Prime Minister Giorgia Meloni tackled the thorny issue of defense spending with President Trump, her finance minister announced Italy would hit 2% of GDP this year.

Speaking in parliament on Thursday, minister Giancarlo Giorgetti said, “We are fully aware, including in light of the current tensions, of the need to increase this spending in the coming years.”

Across the Atlantic at the White House where she visited Trump the same day, Meloni was able to announce, “Italy is honouring its commitments,” adding, “We are a serious nation.”

The two percent announcement was a last minute face-saving exercise for Italy, which has long been a relative low spender on defense, budgeting only 1.54% of GDP in 2024, according to Defense Minister Guido Crosetto, despite longstanding commitments to NATO to spend more.

Getting to two percent was not a given. Italy has little appetite to spend, despite the threat of Russian aggression on its doorstep, with polls showing a majority of Italians do not want to hike defense budgets, while the opposition Five Star party led a march against spending in Rome this month.

More challenging for Meloni is that her deputy prime minister and coalition partner Matteo Salvini has also complained that spare cash should go on hospitals not bombs.

Clearly however, the pressure from the White House and NATO won out, even if 2% is nowhere near the 5% President Trump has called for, or the figure of around 3% NATO will demand in June when members meet.

The next question is how Italy will raise the money.

Defense spending has already shot up in recent years, with procurement outlays hitting €9.31 billion ($10.59 billion) last year, almost double the €5.45 billion spent in 2020.

But if overall spending reached €29.18 billion euros last year, equaling 1.54% of GDP, then pushing that to 2% now means finding an extra €8.7 billion this year to reach a new total of €37.9 billion.

Italian media has speculated the government will try some creative accounting by pushing spending on services like the Coast Guard into the defense category, but one analyst warned against it.

“That’s a dead end – I don’t see any flexibility in the NATO definitions of what constitutes defense spending,” said Alessandro Marrone, who heads the defense, security and space program at Rome think tank IAI.

Another possibility has been pitched by the European Union, which is offering €150 billion in loans for defence spending by member states.

The EU also wants to allow members to exempt defense spending worth up to 1.5% of their national GDP from bloc debt limit rules.

Italy clamored for just such a rule for years, claiming that without it there was no way to boost spending.

“Italy has now obtained the escape clause it has been asking for. There are no more alibis,” said Marrone.

However, on Thursday, finance minister Giorgetti said it was unlikely Rome would use the scheme.

If Italy does conjure up more cash this year, the next question is what it will spend it on, with the U.S. likely putting pressure on Rome to buy American kit.

Last year, according to Italian government figures, nearly a quarter of Italy’s defense imports from outside the EU came from the U.S., worth about about €184 million.

In 2024 Italy committed to spend €7 billion on 25 F-35 fighters to add to the 90 it is already buying. Italy is also buying Gulfstream aircraft in early-warning, signals-intelligence and electronic-attack versions from the U.S.

Italy is meanwhile assembling new tanks and armored vehicles with Rheinmetall while shipbuilding is done in-house by Fincantieri, and new SAMP-T air defense batteries are on order with Europe’s MBDA.

If the U.S. ups the pressure to buy American, the EU is pulling in the other direction, starting with its promised €150 billion in loans for spending.

“It is possible the EU will ask for two thirds of that money to be spent on European products, which is a balance that could suit Italy,” said Marrone.