Military Spending by Country (2025)

Global Military Expenditure

Global military spending exceeded $2.4 trillion in 2024, with the United States accounting for roughly 40% of the total. The US spends approximately 3.5% of GDP on defense — over $900 billion annually, more than the next 10 countries combined in absolute terms. China is the second-largest spender at an estimated $300 billion, though exact figures are difficult to verify due to opaque defense budgets. Russia, despite its smaller economy, allocates an estimated 6-8% of GDP to military following its invasion of Ukraine.

Military spending trends are a barometer of geopolitical tensions. NATO members committed to spending at least 2% of GDP on defense — a target most European members missed for decades but are now rapidly approaching after Russia's 2022 invasion of Ukraine triggered a fundamental reassessment of European security. Germany announced a €100 billion special defense fund, and Nordic countries accelerated their defense buildups. Middle Eastern countries like Saudi Arabia, Israel, and the UAE consistently spend 4-6% of GDP due to regional security threats.

Japan maintained spending below 1% of GDP for decades under its post-WWII pacifist constitution but has recently increased toward 2% in response to China's military buildup and North Korean missile threats. For developing countries, excessive military spending creates a "guns versus butter" trade-off — resources devoted to defense cannot be invested in healthcare, education, or infrastructure that drives long-term economic growth.

In 2026, global military spending reached a record $2.7 trillion — the highest in modern history and the ninth consecutive year of real-terms growth, according to SIPRI. Europe is driving the surge: Germany crossed the NATO 2% threshold for the first time since reunification, Poland is spending 4.1% of GDP (the highest in the alliance), and Finland, Sweden, Estonia, and Latvia have dramatically expanded budgets following Russia's full-scale invasion of Ukraine. Ukraine itself allocates over 35% of GDP to defense — the highest share in the world — funded partly by more than $100 billion in Western military assistance. Russia's defense budget has surged to an estimated 6–8% of GDP, crowding out civilian investment and contributing to domestic inflation above 8%. The Asia-Pacific is also rearming: Japan targets 2% of GDP by 2027 (up from a decades-long 1% cap), Australia is expanding submarine and missile capacity, and South Korea is accelerating domestic weapons production. The geopolitical signal is unambiguous: the post-Cold War "peace dividend" is fully spent. See our analysis: Global Defense Spending Hits Record $2.7 Trillion.