NATO Secretary-General Anders Fogh Rasmussen said during a parliamentary assembly in the Czech Republic that collective defense spending in 2011 was $56 billion less than in 2009.
"The economic crisis has hit our defense spending hard," he said.
With European economies struggling through recession, NATO leaders say cuts in defense spending was inevitable. The alliance, however, said that investing in defense is fundamental in order to protect sustainable economic growth.
NATO's role in Afghanistan is to transition from a military to a training operation as combat forces leave the country in 2014. Rasmussen said that transition further jeopardizes defense spending as collective engagement draws down.
"We need an economic recovery," Rasmussen. "And based on that, we need a defense recovery."
Rasmussen added that very few European member states devoted more than 2 percent of gross domestic product to defense in 2011.
"This is worrying," he said.