Global Defense Spending | connecting-the-dots

The ultimate aim is to lower foreign dependency
Defense spending globally is accelerating up 7.5% in real terms in 2024 that is almost $2.5 trillion which makes around 2% of global GDP.
Though the global military spending has grown by close to 60% over the last 20 years, this is still less than half the cold war average.
- - Europe, MENA and Asia led the growth this time.

The report reveals that world military expenditure rose to $2.718 billion in 2024, a 37% increase from 2015 and the steepest year-on-year rise since 1988

It may increase the defense spending by 1 to 1.5% in the coming years. But it will import intense with limited growth gains initially.
Europe doesn't have the capacity to lift the defense spending to 3.5% of GDP without some form of mutualization given the lack of fiscal space in certain countries.
The current German government announced a fiscal package that meaningfully changes the medium term economic outlook .
National fiscal rule reform to exclude defense spending >1% of GDP from the calculation.
The current debt brake limits the structural deficit to 0.35% of GDP
A EURO 500 billion constitutionally enshrined special purpose vehicle for infrastructure spending over the next decade, ie. 11.6% of 2024 GDP

It should spend more to secure the US borders and to achieve the 2% NATO goal.
In december 2024, Canada announced CA$1.3 billion Border Plan to strengthen the border security. It aims to reach the 2% goal by 2032, currently being at 1.37%. But the defense minister Bill Blair said in January 2025 that is would be absolutely achievable to hit the target by 2027.
The contenders for federal elections this year, 2025, Liberal Party Mark Carney (current PM) aims to reach the target by 2030, by bringing the defense spending back to Canada.
The opponent Conservative leader Pierre Poilievre mentions to strengthen the Northern (arctic) border through a new military base and doubling the size of the Canadian ranger force.

Asia's share globally is dropping though it saw an increase in real terms according to its previous spending.

A Mar - a - Lago accord whereby the US sells protection to other countries in exchange for a weaker dollar and restructuring of the debt profile, has also been floated over the past few weeks.
Despite all the noise, the current political makeup on the hill and in the white house , from a historical perspective suggest that when the budget process is complete, defense budgets will grow something like 2X US inflation.
House Republicans have included more defense spending in both their latest continuing resolution and the budget resolution. Republicans are traditionally defense hawks and support more defense spending. The President Trump called for building a missile defense system in US akin to the one in Israel, 'Golden Dome'.
But this should also been seen with the fact that the current Trump administration is planning to leave NATO or reduce its contribution and forcing the member countries to increase their share of spending.

It would love to become self sufficiency and minimize its dependence on the US in the provision of critical inputs, but the reality is , it will take time.
Financing will come from countries' balance sheets, with little new money beyond the announced EUR 150 billion loan.
The Europe believes that there is significant focus from European nations on buying EU equipment and rebuilding defense industrial base that may surprise positively in terms of demand for the European defense names. Still Europe will remain reliant on US, like F35, advanced missile defense and rocket artillery.
European commission President Ursula Von der Leyen recently published a proposal on how to mobilise up to EURO 800 billion of resources for defense (ReArmEU).

Since the start of the war, Ukraine has spent close to half of its budget on defense, which in 2024 accounted for some UAH 2,300 billion or 51.4%, which makes to 20% of its GDP.
It spent less than 1.6% GDP on defense in 2013 before the annexation of crimea.

It has increased its military spending. It has 3 companies listed among the top 100 companies producing arms in the world. According to SIPRI, its military spending rose 50% to US $15.8 billion in 2023.
Historically US and EU have imposed various sanctions on Turkiye. But most of these were lifted after the approval of Sweden's accession to NATO.
In 2025, its defense spending stood at 2.8% of its GDP.