But French president Emmanuel Macron denied there had been an agreement to boost spending over 2%.
As well as Merkel, Spanish Prime Minister Pedro Sanchez and Charles Michel, the prime minister of Belgium, were singled out by Trump for undershooting on their spending targets when US taxpayers, funding a defense budget worth about 3.6 percent of their national income, foot much of NATO's bills.
"I believe through strength you get peace", he said. "Frankly, Putin may be the easiest of them all, who would think?" he said.
Merkel, who grew up in communist East Germany, shot back that she had "experienced myself a part of Germany controlled by the Soviet Union, and I'm very happy today that we are united in freedom as the Federal Republic of Germany and can thus say that we can determine our own policies and make our own decisions and that's very good".
"Military spending for any country", Koshagarian said, "should be determined by two things: real national security needs, and curbing waste and profit motives that drive military spending up without making us safer".
The Bulgarian President, formerly the commander of the Air Force before being elected head of state on a ticket backed by the opposition socialists, used Trump's statements to take a sideswipe at Bulgaria'scentre-right government, saying that Bulgaria was "reluctant" to allocate funds to the armed forces. "The United States has wasted $5.6 trillion on wars in Iraq and Afghanistan with nothing to show for it", she said.
Mr Trump had opened the first day of talks in Brussels yesterday with a public diatribe against Germany, the second biggest state in the Western defence alliance, before the mood appeared to have calmed as the summit went into its second day, focusing on operations beyond Europe. "So we are helping some of those countries get online and buy the best equipment".
President Trump publicly criticized Germany over its Baltic Sea gas pipeline deal with Russian Federation, calling the wealthiest nation in the European Union "a captive to Russian Federation".
"Now we have to rebuild that democracy and strengthen it. North Atlantic Treaty Organisation is going to take a significant role in that, and Canada is going to commit 250 troops, a number of helicopters, and we are actually offering to command that mission for the first year", Canadian Prime Minister Justin Trudeau announced at the summit. The meeting with the Russian president will arguably be the most attention-grabbing leg of Trump's European tour.
"I would like to thank all our nations for the efforts they are making". He added that the annexation had happened in the era of his predecessor, Barack Obama, and that he wouldn't allow anything similar on his watch.
"I told people that I'd be very unhappy if they didn't up their commitments very substantially because the United States has been paying a tremendous amount ..." Bulgarian President Rumen Radev described the atmosphere on Wednesday as "not the most pleasant".