"I can confirm that next year's sum will be well over 4 percent. But how much exactly depends on the economic forecast. We are in the final stages of our work and are ready to present it to the government shortly," he said in an interview with ERR.

Asked if it would be above or below 4.5 percent of GDP, the minister would not specify.

He said he would make a public announcement after discussing both NATO's military capability goals and Estonia's own military needs with the coalition.

"I also firmly believe that this must be a collective decision by the government — it cannot be determined solely from the perspective of one ministry. The decision on the defense budget will have a significant impact on whether and to what extent other ministries will have funds available for any additional activities," Pevkur said.

The target for 2026 was originally 3.7 percent of GDP but he said it was "clear" it needs to be higher.

"These assumptions are based, first and foremost, on NATO's force capability goals, which will be agreed upon by all member states in June of this year. Secondly, they take into account the additional needs of our Defense Forces, stemming from our own military planning. And thirdly, they include the costs associated with the presence and reception of allied forces," he told "Vikerraadio."

The minister also added the European Commission will finish drafting a white paper on defense in the middle of March which will suggest additional ways member states can increase their spending.

All three Baltic states have pledged to raise defense spending to 5 percent of GDP in the coming years, a target suggested by U.S. President Donald Trump.

Estonia, Latvia and Lithania all already allocate more the 3 percent of GDP to defense spending. Riga is also aiming for 4 percent next year. NATO's target is currently 2 percent, but expected to rise at the alliance's upcoming summit this summer.

Estonia is NATO's second highest spender after Poland which has already cleared 4 percent. The U.S. is third.

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