Global defence spending reaches a whopping US$1.57 trillion

London December 16, 2016
ESCALATION of global terrorism, security fears, persistent Middle Eastern wars and military expansionism have raised global defence spending to a fearsome US$1.57 trillion, writes Neil Behrmann
The latest annual Jane’s Defence Budgets Report calculates that global defence expenditure on weapons, security and other equipment rose by only one per cent in the past year; but Fenella McGerty, a Jane’s analyst, forecasts steeper growth in the next decade.

America, by far the biggest spender

The US defence budget of US$622 billion represents about 40 per cent of the total global defence budget. Since 9/11, over US$9.35 trillion has been allocated to the US defence budget, Jane’s estimates. Middle East spending continues unabated because of present and fears of future conflicts. The next biggest spenders are China (US$191.8 billion), the United Kingdom (US$53.8 billion), India (US$50.7 billion), Saudi Arabia (US$48.7 billion) and Russia (US$48.4 billion), with France and Japan at similar levels. Iran, which is intensely involved in Middle Eastern wars, is not listed in the top 20, because of the regime’s secrecy and sanctions.

South China Sea dispute causing Asian defence spending spurt

“A key trend in the Asia-Pacific is the shift from a traditional focus on territorial defence towards power projection,” noted Craig Caffrey, an analyst at Jane’s. “This is new for the region and is likely to increase military-to-military contact between states. Rising defence spending could therefore be indirectly responsible for increased tension within the region which in turn could spur faster budget growth.”
Between 2011 and 2015, the key states surrounding the South China Sea spent US$166 billion on the procurement of defence equipment, estimates Jane’s. Between 2016 and 2020 that number is expected to increase to US$250 billion, with priorities shifting towards air and naval capabilities, it forecasts.
“China’s defence budget will almost double within 10 years – from US$123 billion in 2010 to US$233 billion in 2020. By 2020, China’s defence budget will be about four times bigger than the UK’s and more than the entire Western European regional defence spend combined.”
Japan’s defence budget will hover around the US$41 billion mark between now and 2020, predicts the report. “Japan cannot realistically match the kind of budget growth we continue to see in China, so the government is focusing upon spending its defence budget more efficiently,” said Paul Burton, director at Jane’s. The report adds that in 2016, India overtook Saudi Arabia and Russia to become one of the top five defence spenders globally for the first time.

Nato and Russian fears

The North Atlantic Treaty Organisation’s (Nato) defence expenditure increased for the first time since 2010 in response to growing strategic challenges posed by the Islamic State and Russia. Tensions with their neighbour Russia has boosted the defence spending of the Baltic states from US$981 million in 2014 to a predicted US$2.1 billion by 2020.

Despite Nato and and Eastern European concerns about Russia, sanctions and economic contraction caused the first reduction in Russian defence expenditures seen since the late 1990s, states the report.
According to Stockholm International Peace Research Institute (Sipri), sales of the world’s 100 largest arms-producing and military services companies totalled US$370.7 billion in 2015 (see table). Top 100 arms sales for 2015 were slightly lower than 2014, but are 37 per cent higher than those for 2002, estimates Sipri. US companies dominate the top 100 arms producers along with a smattering from Western Europe, Russia, India, Israel and South Korea. Singapore’s ST Engineering, with sales of US$1.67 billion in 2015, is listed number 53 of the top arms and military services companies.

copyright Neil Behrmann originally published in The Business Times, Singapore
Neil Behrmann is author of Trader Jack- The Story of Jack Miner and anti-war children’s novel Butterfly Battle- The Story of the Great Insect War

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