Canada will meet NATO's defense spending threshold of 2% this fiscal year, Prime Minister Mark Carney confirmed on Monday.

Carney added that Canada will achieve NATO's spending target of 2% of gross domestic product five years earlier than his Liberal party had previously planned.

"I am announcing today that Canada will achieve NATO's 2% target this year — half a decade ahead of schedule," Carney said during a speech at the University of Toronto. "Now is the time to act with urgency, force, and determination."

The increased spending will see new submarines, aircraft, ships, armed vehicles and artillery, as well as new radar, drones and sensors to monitor the sea floor and the Arctic purchased and a boost in pay for the armed forced

"Our military infrastructure and equipment have aged, hindering our military preparedness," he added.

"Only one of our four submarines is seaworthy. Less than half of our maritime fleet and land vehicles are operational. More broadly we are too reliant on the US."

Reliance on US to be reduced

During his speech Carney said that the world was becoming a "darker" place, meaning that Canada needed to reduce its security dependence on the United States.

Since taking office in mid-March, Carney has delivered a series of stark warnings about what he terms the changing nature of US global leadership under President Donald Trump.

"In a darker, more competitive world, Canadian leadership will be defined not just by the strength of our values, but also by the value of our strength," Carney said.

"The United States is beginning to monetize its hegemony: charging for access to its markets and reducing its (relative) contributions to our collective security. We should no longer send three quarters of our defense capital spending to America."

NATO members increasing defense spending

Carney framed the announcement as a move designed "to protect Canadians, not to satisfy NATO accountants."

In April, NATO announced that 22 of its 32 members hit the 2% spending target. European countries have ramped up their military budgets since Russia's 2022 invasion of Ukraine, and NATO has set 2% as a bottom line for spending.

Canada has also been in discussions with the European Union to join an EU drive to break its security dependency on the United States.

There has been a focus on buying more defense equipment, including fighter jets, from Europe. Carney's government is reviewing the purchase of US F-35 fighter jets to see if there are other options.

Edited by: Zac Crellin