Global military spending rose to 1,651 billion euros in 2020, according to the latest report by the Stockholm International Peace Research Institute (SIPRI). This corresponds to an increase of 2.6 percent compared to the previous year. It is the highest figure since the institute began recording the data in 1988.
The data includes all expenditure that countries spend on their military. This includes all personnel costs as well as armaments expenditure, costs for military operations, military facilities, research and administration. However, according to SIPRI, the procurement of weapons only accounts for a small proportion of the total costs. Nevertheless, a closer look shows that the increase in expenditure is also related to investment in new weapons systems. The big five
The USA, China, India, Russia and the United Kingdom spent the most on their defense in 2020. Together, their spending accounted for 62% of all global military expenditure, with the USA alone responsible for 39% of the total volume. At 648 billion euros, Washington spent 4.4 percent more than in 2019, making it the world leader. SIPRI attributes the increase primarily to American investments in the research and development of new weapons systems as well as long-term procurement projects and the modernization of the nuclear arsenal. The institute sees the reason for this in the USA’s increased perception of China and Russia as a threat – a development that has taken on clear traits under Donald Trump.
China ranks behind the USA with an estimated 210 billion euros. The gap to first place is large: the USA spent almost three times as much as China in 2020. However, if you look at China’s military spending over a longer period of time, the overall picture is put into perspective. This shows that China has been increasing its defense budget without interruption for 26 years. In 2020, it was 76% higher than in 2011. In the USA, it was 10% less last year than in 2011 – a trend that began to reverse during Donald Trump’s term in office. As in the case of Washington, the upward trend in Beijing’s military spending can be attributed to modernization efforts and the acquisition of new weapons systems. Russia is in fourth place behind India with 51.4 billion euros. Even though Russia recorded a 2.5% increase in military spending in 2020 compared to the previous year, the economic consequences of the coronavirus pandemic still played a role. Russia spent 6.6% less than the military budget planned for 2020. Although the pandemic dealt a blow to the economies of most countries, it was the exception that the funds originally earmarked for defense were used to combat the pandemic. Apart from Russia, only Brazil, Chile and South Korea reallocated part of their defense budgets at short notice due to coronavirus. Military spending on the rise worldwide
Whether America or Europe, Africa or Asia, the SIPRI report shows that almost all regions of the world spent more on defense last year. In a regional comparison, Europe ranks third after the Americas and the Asia and Oceania region. In total, European countries spent 315 billion euros on their military last year, an increase of four percent compared to the previous year. The United Kingdom – the country with the fifth largest military budget in the world – is responsible for 49.3 billion euros of this. Germany and France are in a similar range with around 43.9 billion euros each. According to SIPRI, Poland has increased its military budget particularly significantly: The approximately 10.8 billion euros in 2020 represents an increase of 8.7 percent compared to the previous year and a whopping 60 percent compared to 2011. Basically, all 30 NATO countries spent more on their military in 2020. For twelve members of the alliance, it was even two percent or more of GDP. In some cases, however, according to SIPRI, this has to do with the fact that economic output has fallen due to coronavirus, while military budgets have remained the same. The trend of rising military spending was also evident in Africa in 2020. An estimated total of 36 billion euros was invested in defense, which corresponds to an increase of 5.1 percent compared to 2019 and eleven percent compared to 2011. The frontrunners in North Africa are Egypt (included in the Middle East in the SIPRI report), Algeria and Morocco. In sub-Saharan Africa, South Africa and Nigeria are at the top of the rankings.
The only region that saw a reverse trend in military spending in 2020 is the Middle East. Only four out of eleven of the countries analyzed by SIPRI in the region (Egypt, Israel, Jordan and Oman) spent more on their defense last year than in the previous year. Saudi Arabia even cut its defense budget by ten percent compared to 2019. Another development is worth mentioning: Azerbaijan spent 17 percent more on its military last year than in the previous year. This is directly related to the war over Nagorno-Karabakh last fall. In comparison, Armenia spent 2.6 percent less than in 2019, according to SIPRI.
Outlook: Downward trend unlikely
How the pandemic will affect military budgets in the longer term remains unclear. It is conceivable that individual countries will use some of the funds to combat the consequences of coronavirus instead of for defense. However, a downward trend in military spending at a global level is not to be expected. Recent developments already show this. A steep upward trend in rearmament is particularly evident in the case of countries that perceive Russia as a direct threat. Poland, for example, is planning to increase its defense spending as a proportion of GDP from 2.2 percent now to 2.5 percent by 2024. Northern Europe is also undergoing a major arms build-up. A few months ago, Sweden announcedto increase its military spending by 40 percent over the next five years. Norway, Finland and Denmark are also investing more in their defense against the backdrop of tensions with Russia. Concerns about China’s continuous rearmament are also reflected in the military budgets of countries in the region. India, Japan, Australia and South Korea in particular have invested more heavily in their defense in recent years. As uncertain as the future is in times of corona, one thing seems unchanged: the stronger the threat perception of a country, the more it invests in its defense. Given the increasing rivalries and uncertainties around the world, it is unlikely that the economic costs of the pandemic will reverse this trend.
