Global Defense Spending Reaches All-Time High $2.4 Trillion Amid Rising Tensions

Rabat – Defense spending reached an unprecedented $2.4 trillion in 2023, with a year-on-year increase of 6.8%, the highest increase since 2009, according to data from the Stockholm International Peace Research Institute (SIPRI).

In a report published on Monday, SIPRI data show that the trend extends to all regions in the world, with the United States, China, and Russia being the largest defense spenders worldwide.

“The unprecedented rise in military spending is a direct response to the global deterioration in peace and security,” said Nan Tian, Senior Researcher with SIPRI’s Military Expenditure and Arms Production Programme.

The institution notes that, for the first time, the increase in military spending was observed across all regions included in the study, especially in Europe, Asia and Oceania, and the Middle East.

In war-afflicted regions, the trend has been even more dire. In Europe, defense spending in Ukraine represented 58% of overall government spending as the defense budget reached $64 billion. Ukraine’s military spending spiked by a staggering annualized rate of 51% in 2023.

Meanwhile, Russia’s military spending saw a 24% hike, settling $109 billion in 2023. The figure marks a 57% increase compared to 2014, the year Russia annexed Crimea.

NATO accounts for over half of military spending

The 31 members of the North Atlantic Treaty Organization (NATO) accounted for a staggering $1.3 trillion, approximately 55% of global defense spending. While the US continued to be the largest spender within the alliance, other European countries have equally increased their defense budgets.

The US military budget rose by an annual rate of 2.3% to $916 billion, approximately 68% of the alliance’s spending.

SIPRI attributes the spike in NATO spending to be the direct result of the war in Ukraine.

“For European NATO states, the past two years of war in Ukraine have fundamentally changed the security outlook,” said Lorenzo Scarazzato, Researcher with SIPRI’s Military Expenditure and Arms Production Programme.

“This shift in threat perceptions is reflected in growing shares of GDP being directed towards military spending, with the NATO target of 2% increasingly being seen as a baseline rather than a threshold to reach,” he noted.

11 out of 31 NATO members have reached or surpassed the 2% of GDP spending target the alliance set a decade earlier. NATO equally reached another milestone; that of spending 20% of defense budgets on “equipment spending,” up from an average of 7% in 2014.

China drives regional increase in defense budget

“China is directing much of its growing military budget to boost the combat readiness of the People’s Liberation Army,” said Xiao Liang, Researcher with SIPRI’s Military Expenditure and Arms Production Programme.

According to the SIPRI expert, the rise in China’s military spending“has prompted the governments of Japan, Taiwan and others to significantly build up their military capabilities, a trend that will accelerate further in the coming years.”

At the end of 2023, China’s military spending rose to $296 billion, up 6% compared to 2022, and marking the 29th consecutive annual rise in the country’s defense budget. The country accounted for half of all military spending across Asia and Oceania.

Mirroring China’s rising military spending, Japan’s defense budget reached $50 billion, an 11% annual spike. Meanwhile, Taiwan’s military spending equally rose by 11% compared to 2022, settling at $16.6 billion.

In the Middle East, the report shows that defense spending saw the highest annual spike in over a decade, with Saudi Arabia and Israel largely to blame. In 2023, Israel’s defense spending reached $27.5 billion, an annual 24% spike, following their all-out war on Gaza.