The war has returned. Rich countries are spending more on weapons. The US -led NATO plans to increase the defense budget for the next decade. America, 27 European Union countries and Britain are already spending more than half of all military expenses. Poor countries will have to struggle to maintain it and they may be forced to give priority to military on other, more important domestic needs.
The implications of the new five percent of the GDP for NATO’s defense spending – more than doubled than the current target – move ahead of military balance. The purpose of this effort is to motivate Europe and Canada to invest more in their armies rather than depending on the US for security. However, by 2024, nine out of 32 members of NATO have still not reached the promise of two percent prescribed in 2014 a decade ago.
Why does it matter: It is not just a matter of arms race. Redistribution of public resources for defense comes with financial agreements that can affect the budget of healthcare, education and infrastructure, especially in developing countries.
Looking at the statistics, it is found that world military expenditure in 2024 has reached $ 2718 billion, which is 37 percent more than 2015. The 9.4 percent increase in 2024 was the biggest growth after 1988. Military expenses are now 2.5 percent of the world’s GDP or about $ 334 per person per person.
In 2024, the US alone will spend about 37 percent of global military expenses. China ranks second with 12 percent, while the European Union is 27 and UK jointly at third with 17 percent. After the attack on Ukraine, Russia reached six percent, while India spends three percent of its budget on its defense.
The rest of the world’s share has come down from about 22 percent to 25 percent in 2024 in 1994, while the total military expenditure has increased. Global military expenditure increased in 2024, the credit for some countries go to some countries. The US, the European Union is 27 per cent, and 54 per cent of the UK total, which is the main part of NATO, which is planning to increase the defense budget in a recent agreement on 25 June.
NATO plans to spend 3.5 percent of its GDP on defense and 1.5 percent on security by 2035, which reflects the actual growth of $ 800 billion annually. NATO’s new spending plan shows what he says to “Russia’s big threats for euro-alantic security”.
Israel spent 9 percent of its GDP on defense in 2023, the highest in an advanced economy. Japan is also increasing its defense budget. Since 2014, the US and its allies have expanded their share in global military expenses.
Conversely, China’s share has stabilized at slightly more than 12 percent, and India’s growth has been stable but modest. Meanwhile, the rest of the world – which includes most of the global South – is under pressure despite the growing security requirements.
Big picture: In recent years, armed conflicts and geopolitical tension have increased worldwide. The second consecutive year, military expenses have increased in all five geographical areas of the world, which shows increased geopolitical tension worldwide.
The credit for the decade growth in global expenses can be partially given to the expenditure increase in Europe, which is mainly inspired by the ongoing Russia-Ukraine War and Israel’s Gaza, Lebanon, Syria and recently war on Iran.
Many countries have also committed to increase military expenditure, which will increase the global growth in the coming years. Military boom may promote industrial activity in a short time, but it also leads to a risk of long -term fiscal stress.