US treasury secretary tells Spain to boost defense spending during tariff talks

US Treasury Secretary Scott Bessent urged Spain to boost defense spending during tariff talks with his Spanish counterpart in Washington, according to a statement released late Tuesday.

Bessent met with Spanish Trade Minister Carlos Cuerpo, who expressed optimism that the US is open to "fair" negotiations on tariffs.

"We spoke of defense spending in terms of NATO and the EU," Cuerpo told reporters after their Tuesday meeting.

"We put forward the arguments … that we should not only talk about defense but broaden the concept of security. For a country like Spain, areas such as cybersecurity are fundamental."

Cuerpo also reaffirmed that Spain will meet the NATO target to spend 2% of its GDP on defense "ahead of schedule."

Among NATO members, Spain lags behind in defense spending, allocating just 1.32% of its GDP. Madrid says it will meet the 2% target before 2029, although Prime Minister Pedro Sanchez has recently avoided giving a specific timeline.

"But let us not forget that, from the EU perspective, there must also be a joint element of shared financing for these expenses," Cuerpo added in Washington.

Bessent also underlined his government's opposition to the digital services tax levied by Spain and other countries.

Commonly known as the "Google tax," Spain imposes a 3% levy on revenues generated from digital services provided by large multinational tech firms.

Cuerpo's trip to Washington came after Sanchez met with Chinese President Xi Jinping last week in Beijing.

Last week, Bessent said that Spain aligning with China would be like "cutting your own throat."

Cuerpo told reporters that while reaching a deal with the US on tariffs is essential, "China also has to be a strategic partner."

Earlier this month, US President Donald Trump announced 20% import taxes on all EU goods. However, he later declared a 90-day pause on the full rate with a 10% universal tariff now in effect, along with higher rates on steel, aluminum, and vehicles.