Chapter 5. Military expenditure

SAM PERLO-FREEMAN, OLAWALE ISMAIL AND CARINA SOLMIRANO

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Summary

Total global military expenditure in 2009 is estimated to have been $1531 billion. This represents an increase of 6 per cent in real terms compared to 2008, and of 49 per cent since 2000. Military expenditure comprised approximately 2.7 per cent of global gross domestic product (GDP) in 2009. All regions and subregions saw an increase in 2009, except the Middle East.

The global economic crisis had little impact on world military spending in 2009, as most major economies boosted public spending to counteract the recession, postponing deficit reduction. While military expenditure was not a major feature of economic stimulus packages, it was not generally cut either. Nine of the top 10 spenders increased military spending in 2009. However, some smaller economies less able to sustain large deficits did cut spending.

Natural resource revenues appear to be a significant driver of military expenditure in many developing countries, with rapidly rising revenues from oil and other commodities in recent years, due to increases in both price and production. This may lead to increased military spending as a means of protecting resources from internal or external threats, while resource revenues are often a source of funding for arms purchases. The drop in commodity prices in 2009 has slowed this trend in some cases.

The conflict in Afghanistan is proving increasingly costly to many of the countries with a substantial troop presence there and has also generated debates as to the focus of military spending, between equipment of use in current conflicts and major weapon platforms designed for power projection. In the UK a combination of the Afghanistan conflict, high deficits and an overambitious equipment programme have sharpened this debate.

US military spending is continuing to rise under the Obama Administration, partly due to the escalating conflict in Afghanistan. Spending is budgeted to rise further in 2010, and military spending is exempted from a general freeze on discretionary spending. The 2010 budget saw some refocusing of priorities, with cancellation of some major weapon systems and increased focus on information and communications technology, but no major strategic shift.

Military spending patterns in Afghanistan and Iraq both reflect the demands of rebuilding a country’s armed forces from scratch following external invasion and with continued requirement for substantial external funding.

 

 

Dr Sam Perlo-Freeman (United Kingdom) is a Senior Researcher with the SIPRI Military Expenditure and Arms Production Programme, responsible for monitoring data on military expenditure worldwide. 

Dr Olawale Ismail (Nigeria) is a Researcher with the SIPRI Military Expenditure and Arms Production Programme and Project Coordinator for the SIPRI Africa Security and Governance Project. 

Carina Solmirano (Argentina) is a Researcher with the SIPRI Military Expenditure and Arms Production Programme responsible for monitoring military expenditure in Latin America, the Middle East and South Asia.

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