Global spending increased by 2.9 per cent in real terms compared with 2024, bringing the global military burden to 2.5 per cent of gross domestic product, its highest level since 2009. The annual rise was significantly lower than the 9.7 per cent increase recorded in 2024, largely due to reduced spending by the United States.
The United States remained the world’s largest military spender at $954 billion, despite a 7.5 per cent decline. SIPRI said the fall was primarily linked to the absence of newly approved military aid packages for Ukraine during 2025.
“Global military spending rose again in 2025 as states responded to another year of wars, uncertainty and geopolitical upheaval with large-scale armament drives,” said Xiao Liang, researcher with SIPRI’s Military Expenditure and Arms Production Programme. “Given the range of current crises, as well as many states’ long-term military spending targets, this growth will probably continue through 2026 and beyond.”
Despite the decline, Washington continued investing in nuclear and conventional capabilities aimed at maintaining dominance in the Western Hemisphere and deterring China in the Indo-Pacific. SIPRI said U.S. military spending could rise sharply again after Congress approved more than $1 trillion for 2026.
“The decline in US military expenditure in 2025 is likely to be short-lived,” said Nan Tian, Programme Director of SIPRI’s Military Expenditure and Arms Production Programme. “Spending approved by the US Congress for 2026 has risen to over $1 trillion, a substantial increase from 2025, and could rise further to $1.5 trillion in 2027 if President Trump’s latest budget proposal is accepted.”
Military expenditure in Europe rose by 14 per cent to $864 billion, making it the largest contributor to global growth. SIPRI said rising costs linked to the war in Ukraine and broader rearmament efforts among European NATO members drove the increase.
Russia increased military spending by 5.9 per cent to $190 billion, while Ukraine raised expenditure by 20 per cent to $84.1 billion, equivalent to 40 per cent of its GDP. SIPRI said both countries recorded their highest-ever military spending burdens relative to government expenditure.
“In 2025 military expenditure as a share of government spending reached the highest level ever recorded in both Russia and Ukraine,” said Lorenzo Scarazzato, researcher with SIPRI’s Military Expenditure and Arms Production Programme. “Their spending is likely to keep growing in 2026 if the war continues, with revenues from Russia’s oil sales increasing and a major European Union loan expected by Ukraine.”
The 29 European NATO members spent a combined $559 billion in 2025, with 22 nations allocating at least 2 per cent of GDP to defence. Germany became the largest military spender in the group after increasing expenditure by 24 per cent to $114 billion.
“In 2025 military spending by European NATO members rose faster than at any time since 1953, reflecting the ongoing pursuit of European self-reliance alongside increasing pressure from the United States to strengthen burden sharing within the alliance,” said Jade Guiberteau Ricard, researcher with SIPRI’s Military Expenditure and Arms Production Programme.
Military expenditure in Asia and Oceania rose by 8.1 per cent to $681 billion, the fastest annual growth since 2009. China increased spending by 7.4 per cent to $336 billion, while Japan raised expenditure by 9.7 per cent and Taiwan increased spending by 14 per cent.
“US allies in Asia and Oceania such as Australia, Japan and the Philippines are spending more on their militaries, not only due to long-standing regional tensions but also due to growing uncertainty over US support,” said Diego Lopes da Silva, senior researcher with SIPRI’s Military Expenditure and Arms Production Programme.
Military expenditure in the Middle East remained broadly stable at $218 billion. SIPRI said Iran recorded a second consecutive annual decline in real terms due to high inflation, although actual spending may be higher than official figures suggest.
“Despite the recent conflicts, Iran’s military spending decreased in real terms due to economic difficulties,” said Zubaida Karim, researcher with SIPRI’s Military Expenditure and Arms Production Programme. “However, official figures almost certainly understate the true level of Iran’s spending—Iran also uses off-budget oil revenues to finance its military, including the production of missiles and drones.”
Source: SIPRI.
