A global balance of terror is being established across all corners of the planet, as the latest data shows a new surge in military expenditures. Specifically, global military spending rose by nearly 3% in 2025, primarily due to the explosion of defense budgets in Europe and Asia, according to a report published Monday by a prestigious arms monitoring group.
Spending at 2.9 trillion
Defense spending in Europe increased by 14% compared to 2024, reaching 864 billion dollars, while in Asia-Oceania the increase was 8.1%, at 681 billion dollars, according to the Stockholm International Peace Research Institute (SIPRI) in its annual report "Trends in World Military Expenditure." Overall, nearly 2.9 trillion dollars were spent globally on military programs in 2025, marking a 2.9% increase over the previous year. This amount corresponds to 2.5% of the global gross domestic product (GDP), the highest percentage since 2009, according to SIPRI.
The 5 champions
The US, China, Russia, Germany, and India were the five countries with the largest expenditures, collectively accounting for 58% of the global total. Although the report notes that the annual increase in total spending is smaller than the 9.7% increase recorded in 2024, this is mainly because the US did not approve new funding for Ukraine's equipment in 2025. SIPRI calculates foreign military aid within the accounts of the donor country. Without the US, global defense spending increased by 9.2% in 2025, according to the report.
US and China
Nevertheless, the US remains the country with the largest military expenditures in the world—with 954 billion dollars in 2025—followed by China with approximately 336 billion and Russia with approximately 190 billion. Despite this, it was the global allies of the US that drove the spending increase, revealing significant shifts.
Europe is rearming
"In 2025, the military expenditures of European NATO members grew faster than at any time since 1953, reflecting the pursuit of European autonomy alongside increasing pressure from the US to boost burden-sharing within the alliance," said Jade Guiberteau Ricard. NATO countries with large increases include Belgium (59%), Spain (50%), Norway (49%), Denmark (46%), Germany (24%), Poland (23%), and Canada (23%). Germany, with total military spending of 114 billion dollars, ranks fourth globally.
Records in Japan, explosion in Asia
In Asia, Japan increased its military spending by 9.7%, reaching 62.2 billion dollars. As a percentage of GDP, the 1.4% spent on defense is the highest level for the country since 1958. "US allies in Asia and Oceania, such as Australia, Japan, and the Philippines, are increasing their military spending not only due to long-standing regional tensions, but also due to growing uncertainty regarding US support," stated Diego Lopes da Silva. Meanwhile, Taiwan increased its military spending by 14.2%, to 18.2 billion dollars (2.1% of GDP), marking its largest increase since 1988. Under the Taiwan Relations Act, Washington is obligated to provide Taiwan with the means for its defense and supplies it with defense equipment.
The largest annual increase in China
China increased its defense spending by 7.4%—the largest annual increase in the last decade and the 31st consecutive year of growth—as it seeks to modernize its armed forces by 2035.
40% of Ukraine's GDP
As a percentage of GDP, Ukraine is the country that spends the most on military equipment in the world, at approximately 40%, as it enters its fourth year of war with Russia. It ranks seventh globally. Russia allocated 7.5% of its GDP to the military, increasing its spending by 5.9% compared to 2024. "In 2025, military spending as a percentage of government expenditure reached the highest level ever recorded in both Russia and Ukraine," said Lorenzo Scarazzato.
What is happening in the Middle East and Africa
In the Middle East, Saudi Arabia was the top spender at 83.2 billion dollars, an increase of 1.4%. Israel followed with 48.3 billion dollars, showing a 4.9% decrease, due to the de-escalation of conflicts in Gaza after the January 2025 ceasefire. Iran saw its spending decrease by 5.6% in real terms, but high inflation and revenue from unrecorded oil sales mean they likely increased in practice. "Official figures almost certainly underestimate the true level of Iran's spending," said Zubaida Karim. In South Asia, India's military spending rose by 8.9% to 92.1 billion dollars, driven by the conflict with Pakistan. In Africa, military spending increased overall by 8.5%, reaching 58.2 billion dollars. Algeria is the country with the largest military expenditures on the continent.
Arms race
SIPRI estimates that defense spending will increase even further in the coming years. "Given the scale of current crises, as well as the long-term goals of many states, this growth will likely continue through 2026 and beyond," said Xiao Liang. The US is expected to play a significant role in this increase. Congress has already approved over 1 trillion dollars for defense spending in 2026, as the war with Iran costs approximately 1 billion dollars daily. For 2027, the administration of Donald Trump is proposing a defense budget of 1.5 trillion dollars.
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