Global defence spend has accelerated in recent years, reaching historic highs in many countries. Tamsin Hunt examines some of the developments driving increased military spending around the world.
The world is grappling with the highest number of conflicts seen since World War II, with a total of 59 in 2023, according to the Peace Research Institute of Oslo, alongside geopolitical fragmentation and a raft of localised and regional security challenges. It is therefore unsurprising that global defence expenditure reached an all-time high in 2023, increasing by 6.8 percent from 2022, and is set to rise further still in 2024. Conflict, of course, is not evenly spread across the globe, and nor is defence spend. Governmental policy decisions are informed by regional dynamics, bilateral security partnerships and domestic considerations. Here, we examine some of the regional dynamics driving the shift in government defence spending.
Defence spend by region from 2000 to 2023.
*Some countries are not included, such as North Korea, Syria and Yemen, due to the absence of available data
Data sourced from the Stockholm International Peace Research Institute (SIPRI).
The US
The US is by far the world’s largest defence spender, accounting for 37 percent of the world’s share, and long filling a role of protector to many countries across the globe. Its contributions to NATO, the US’s primary military alliance, amounts to 15.8 percent of NATO’s total military budget, and in December 2023, the US Congress approved a record national defence budget of USD 886 billion for 2024, with specific provisions for Ukraine and military aid in the Indo-Pacific region.
In recent years, however, the US has experienced a notable shift within its political establishment, with increasing scrutiny on foreign military support. Debates have raged around US support for Israel during its military operation in Gaza, for instance, while others have questioned the scale of US contributions to NATO and Ukraine. Indicatively, in that same December 2023 budget, President Joe Biden was unable to push through his proposed allocation of USD 61 billion to Ukraine, in the end lowering it to just USD 300 million. In the event that the upcoming election in November 2024 results in a change in administration, this shift in US is likely to accelerate, forcing its allies to re-evaluate their own defence policies.
Europe
At least in Europe, that re-evaluation is in fact already well underway. Added to fears that the US may pull some of its funding to NATO, Russia’s invasion of Ukraine in February 2022 caused a fundamental shift in attitude amongst Europe’s governments, who now no longer view NATO’s defence budget target – two percent of a country’s GDP – as an aspiration, but rather a minimum baseline. According to the latest data from NATO, 23 out of 30 European member states will meet or exceed the two percent target in 2024 – compared to only three who met the target in 2014, and seven in 2022. Relative to its size, Poland is set to outstrip the rest, with a defence budget equivalent to more than four percent of the country’s GDP, while Finland, one of NATO’s newest members, has almost doubled its defence budget between 2020 and 2024, making some recent big-ticket purchases, buying 64 F-35 fighter jets in December 2021, and 17 naval boats in July 2023.
Defence spend as a share of GDP across Europe in 2023.
Data sourced from SIPRI.
Middle East
Hamas’s attack on Israel on 7 October, and Israel’s subsequent military operation in the Gaza Strip, has raised concerns of a widening conflict in the Middle East. Coming on the back of a period of relative calm – of talks of rapprochement and easing tensions between Middle Eastern countries and Israel – fears of widening conflict in late 2023 and 2024 have driven a nine percent increase in the region’s defence budgets, led primarily by Saudi Arabia and Israel. Israel’s defence budget in particular, already the second largest in the region, increased by 24 percent from 2022 to 2023, reaching 5.3 percent of its GDP. Meanwhile, Iran, Israel’s sworn adversary, is estimated to be the fourth largest defence spender in the region. While its defence spending is typically opaque and secretive, the national budget for the Islamic Revolutionary Guards Corps (IRGC) increased by 28 percent from 2022 to 2023, while the budget for its intelligence ministry increased by 50 percent.
Asia
China is the world’s second largest defence spender after the US, and accounts for approximately half the total military expenditure across the Asia Pacific region. While China’s expanding military is nothing new, with 2024 marking the 29th consecutive year of defence budget growth in the country, its growing capabilities and territorial assertiveness towards Taiwan and the South China Sea has led to rising unease among other countries in region. Additionally, repeated military posturing by North Korea, while unlikely to escalate into open conflict in the foreseeable future, has contributed to the growing emphasis on defence amongst its neighbours.
Rising defence spend in Asia Pacific
Japan, historically a nation with limited military strategy, is working towards doubling its defence spend over the five years from 2022 to 2027, with particular focus on air and missile defence, and long-range capabilities.
Taiwan’s military budget will increase by 7.7 percent from 2024 to 2025, equal to almost 2.5 percent of its GDP. Taiwan specifically aims to procure new fighter jets and step up missile production.
South Korea’s defence ministry proposed a new strategy in December 2023, looking to bolster its defence capabilities with military satellites, submarines and missile defence systems. This strategy would require average annual budget increases of seven percent from 2024 to 2028.
Australia increased its defence budget by 6.3 percent for the 2024-2025 fiscal year, with the objective of reaching 2.3 percent of the country’s GDP in the next 10 years. Almost 20 percent of that budget goes to its navy, funding the nuclear-powered submarine programme under the AUKUS trilateral security partnership with the UK and US.
Latin America
In Latin America, the rise in defence spending is largely related to domestic dynamics, like internal political instability and rampant violence by organised criminal gangs. Peru, for example, deployed the army against anti-government protesters in mid-2022; and, following the example set by El Salvador in 2022, Brazil, Mexico, Ecuador and Paraguay have deployed their militaries internally in efforts to stem gang violence in those countries. In August 2024, Argentina filed legislative reforms that would allow it to do the same, and the Dominican Republic increased its military spending by 17.4 percent from 2022 to 2023, in response to rising crime and instability in neighbouring Haiti.
Sub-Saharan Africa
Military expenditure in sub-Saharan Africa increased by 8.9 percent from 2022 to 2023, driven by localised conflicts and a slew of domestic and regional security issues. Amid rising tensions between the Democratic Republic of Congo and Rwanda, the DRC’s military spend increased by an astonishing 105 percent from 2022 to 2023; while in South Sudan, the government’s defence budget increased by 78 percent over the same period, due to escalating violence in Abyei Region, and an influx of refugees fleeing the war in Sudan. Nigeria, the region’s biggest spender, has allocated 12 percent of its total budget to defence in 2024, in efforts to combat security challenges stemming from Islamist insurgents in the northeast, separatist militias in the south, and expanding criminal groups in the northwest and central regions.
