Spain is resisting U.S. President Donald Trump's demands to hike defense spending to 5 percent of national output, potentially threatening NATO unity at a crucial alliance summit this month.

The European country ended 2024 as the NATO member that dedicated the smallest proportion of its annual economic output to defense, falling short of the two percent target set in 2014.

Faced with Trump's threats to withdraw U.S. security guarantees from member states perceived as not pulling their weight, Spain has announced fresh spending to hit the two percent mark this year.

But Madrid is balking at suggestions the target should rise to five percent. With Germany and Poland already backing the new benchmark, Spain could find itself isolated among its allies at the June 24-25 NATO summit in The Hague.

"Many countries want five (percent), we respect that, but Spain will fulfill those objectives set for us," Defense Minister Margarita Robles said on the sidelines of a meeting of NATO counterparts in Brussels this month.

"What is really important is that Spain will meet the capacities and objectives" assigned by NATO and "we cannot set ourselves a percentage," she said.

For Felix Arteaga, a defense specialist at Madrid's Elcano Royal Institute, "internal political reasons" are determining the stance of the minority left-wing coalition government.

Socialist Prime Minister Pedro Sanchez faces a balancing act of aligning with NATO allies and cajoling his far-left junior coalition partner Sumar, which is hostile to increasing military spending.

He has not submitted to parliament the plans for new defense spending of more than 10 billion euros (roughly $12 billion), sparking criticism from his parliamentary allies whose support is crucial for the government's viability.

The fragile coalition has wobbled in the past week after a corruption scandal implicating one of Sanchez's inner circles sparked a crisis within his Socialist party.

In Spain, "high political fragmentation makes it difficult to reach deals similar to those of other countries" such as Germany, said Santiago Calvo, an economics professor at the Universidad de las Hesperides.

Calvo also pointed to "delicate" public finances, with Spain's debt one of the highest in the European Union at 103.5 percent of gross domestic product.

As for Arteaga, the Iberian Peninsula's greater distance from Russia than eastern European countries like Poland "reduces concern and urgency... we do not feel threatened, we do not want to enter armed conflicts."

Ambiguity also surrounds the idea of investing five percent of GDP in defense.

NATO chief Mark Rutte has mentioned 3.5 percent of military spending in the traditional definition of the term by 2032, with the remaining 1.5 percent going to security in a broader sense, including border protection and cybersecurity.

At the NATO summit, "everything will come down to details" such as the flexibility of the definition of defense spending and the time frame to achieve it, Arteaga predicted.

(With input from AFP)