BRUSSELS, Feb 14 (Reuters) - NATO's European allies and Canada increased defence spending by 3.8 percent last year, amounting to around $10 billion more than 2015, NATO Secretary-General Jens Stoltenberg said on Tuesday as the alliance tries to end years of cuts.
U.S. President Donald Trump has sharply criticised European defence spending, saying this month that NATO members must make "their full and proper financial contributions", although last year's rise is a broader response to Russia's 2014 annexation of Crimea and concerns about Islamist militancy.
"We are making a significant step forward but we have a long way to go ... it is not enough," Stoltenberg told a news conference, saying Trump had stressed the need for more defence spending in the two phone calls the two men have held.
Stoltenberg said Latvia, Lithuania and Romania are moving towards the NATO goal of spending at least 2 percent of economic output on defence. Germany is also increasing spending.
However, in 2015 only Britain, Poland, Greece and Estonia met the 2 percent NATO spending goal.
"The picture is still mixed, some allies are still really struggling," Stoltenberg said when asked about budget constraints in Italy, which is trying to reduce its budget deficit following the euro zone crisis.
Stoltenberg, who will meet Russia's Foreign Minister Sergei Lavrov later this week at the Munich Security Conference, said he expected Europe's defence spending to be one of the main topics at a NATO summit in May in Brussels with Trump. (Reporting by Robin Emmott; Editing by Janet Lawrence)