What Is NATO and How Is It Funded?

Donald Trump is in Brussels this week for what promises to be the most fractious NATO summit in years.

The president began the two-day meeting by renewing attacks on allies failing to meet their spending commitments. He singled out Germany, which he claimed was a "captive" of Russia.

Below, Newsweek takes a look at the organization's history, its membership, and examines who pays what.

German Chancellor Angela Merkel, Belgian Prime Minister Charles Michel, NATO Secretary General Jens Stoltenberg, U.S. President Donald Trump and British Prime Minister Theresa May attend the opening ceremony at the 2018 NATO Summit at NATO headquarters on July 11, 2018 in Brussels, Belgium. Leaders from NATO member and partner states are meeting for a two-day summit, which is being overshadowed by strong demands by U.S. President Trump for most NATO member countries to spend more on defense. Getty Images

What is NATO?

NATO, or the North Atlantic Treaty Organisation, is a military alliance comprising the U.S., Canada, and several European countries. Its purpose is perhaps best encapsulated by Article 5 of its founding treaty, which states: "An armed attack against one [NATO member] ... shall be considered an attack against them all."

It was formed in 1949, amid fears in Washington and European capitals that Josef Stalin's Red Army could overrun run Western Europe in the wake of World War II.

NATO's first secretary-general, Lord Hastings Lionel Ismay, said NATO existed to "keep the Soviet Union out, the Americans in, and the Germans down."

During the Cold War, it was the main pillar of European security. However, it was only after the 1991 collapse of the USSR that its forces were deployed in combat.

NATO troops were deployed in the Balkans after the fracturing of Yugoslavia, when the region was torn apart by civil war. Article 5 was invoked for the first and so-far only time in 2001, following the 9/11 attacks, and NATO forces assisted in the U.S. campaign to oust the Taliban from Afghanistan.

After the end of the Cold War, some questioned whether the alliance had any relevance in a modern world, but the 2014 annexation of Crimea has refocused it on deterring revanchist Russian aggression in Eastern Europe. Plans for a new rapid deployment force for the alliance's eastern flank are among the key topics under discussion at this week's summit.

Who are the members of NATO

The alliance's founding members were the U.S., Canada, the United Kingdom, France, Italy, Portugal, Norway, Denmark, Iceland, Belgium, the Netherlands and Luxembourg.

In 1952, Greece and Turkey joined, followed by West Germany in 1955. Spain joined in 1982.

After the collapse of the USSR, several eastern European countries came under the NATO fold, with the Czech Republic, Hungary and Poland becoming members in 1999, then Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia and Slovenia in 2004, followed by Albania and Croatia in 2009.

Montenegro joined the alliance in 2017.

Ukraine has expressed an interest in joining in recent years.

How is NATO funded?

The alliance's annual costs come to almost $2 billion a year, with the U.S. paying 22 percent of that.

The money each member pays is calculated according to a formula that takes account of its economic size, with the budget spent on integrating the militaries of member states and on administrative costs.

There are discrepancies in the amount of money each member state spends on its military, and at U.S. urging, in 2014 NATO member states pledged to move towards a 2 percent of GDP military spending commitment within a decade.

The U.S. spends significantly more than this, with 3.61 percent of its GDP going to defense, while most European members still spend under 2 percent. The other members who meet or exceed their spending commitments are Greece, Estonia, the U.K. and Poland.

It is this shortfall that has been the focus of Trump's attacks.

However, there are signs the alliance's members are moving towards meeting the pledge, with 22 of 28 NATO members increasing their defense budgets between 2013 and 2017.