When the U.S.is removed from the equation, the group increased its spending by 3.8% in real terms in 2016.
"There is no debt account at Nato", Von der Leyen said in a statement, adding that it was wrong to link the alliance's target for members to spend 2% of their economic output on defence by 2024 exclusively to Nato.
The instruction was non-binding, and some members - including Germany - ignored it. Von der Leyen, the defense minister who rebuked Trump, told German public broadcaster Deutsche Welle at the time that she saw no need for Germany to meet the commitment, as it was already the alliance's second-largest military contributor.
"Defense spending also goes into United Nations peacekeeping missions, into our European missions and into our contribution to the fight against IS terrorism", Ms. von der Leyen said.
Merkel's center-left rivals in a September election, and current coalition partners, have struck a sharper tone on the Trump administration's reinforcement of demands that North Atlantic Treaty Organisation allies pay more.
He added that "the United States must be paid more for the powerful, and very expensive, defense it provides to Germany!"
Just five members met the commitment in 2015: the USA, U.K., Greece, Estonia and Poland. However, "many others" plan to reach 2% by 2024, the report states.
Allies also have increased spending on their own defense in light of concerns about a more aggressive Russian Federation and are taking part in operations in the Baltics.
"Despite what you have heard from the FAKE NEWS, I had a GREAT meeting with German Chancellor Angela Merkel", he tweeted.
"The US decides for itself how much it contributes to defending NATO", Daalder continued.
In 2006, the alliance floated the idea that all members should spend at least 2% of GDP on defense. "That's a good thing".
"Number one it was obsolete, because it was designed many, many years ago". "But it is a process, and it is a process that the United States of America wanted. and we can not simply cast off this process from one day to the next".