TSAMTO, April 24. The Stockholm International Peace Research Institute (SIPRI) has presented a report on global defense spending in 2022 and for the last 10-year period (2013-2022).
The report notes that global defense spending in 2022 reached a record high.
According to SIPRI, global defense spending increased by 3.7% in 2022 and reached a record high of $2.224 trillion.
According to SIPRI, a significant increase in defense spending is primarily due to the conflict in Ukraine. At the same time, Europe's assistance to Kiev, as well as the increased costs of the Russian Federation, forced a number of states to also revise their military budgets.
The defense budget of Ukraine, according to SIPRI, reached $44 billion in 2022.
TSAMTO will present its results on global military spending by the end of 2022 this fall. In a preliminary order, it can be noted that many of SIPRI's assessments can be agreed.Below, for comparison, TSAMTO provides its analysis of changes in global defense spending in the period 2014-2021 (TSAMTO, unlike SIPRI, calculates over 8-year periods).
The growth rate of global military spending has decreased significantly since the crisis of 2008-2009.
The impact of the crisis was so significant that its consequences could not be completely overcome over the next 10 years. In addition, already in the period under review, in 2019-2020, the depression of the world market caused by the crisis of 2008-2009 was superimposed by another recession of the world economy associated with a reduction in production due to the COVID-19 coronavirus pandemic.
Separately, it should be noted that Russia's conduct of a special military operation (SVO) in Ukraine may lead to a landslide increase in military spending in the world (which is already happening in NATO countries). Its influence can block all negative trends that contribute to the reduction of military spending and make the growth of military spending an absolute dominant in the world.
In absolute terms, over the period under review (2014-2021), the increase in defense spending was alternating. It should be noted that to a large extent, the nature of changes in global military spending depends on US defense spending, since the US share in global military spending ranges from 40 to 45% for various years.
In 2011 (three years before the beginning of the period under review), military spending reached a local maximum of $1,635.157 billion (at current prices of this year). After the alternating results at the beginning of the period under review, the volume of military spending in 2018 alone only slightly exceeded the level of 2011 ($1686.976 billion). A certain optimism was caused by the result for 2019 (1754.843 billion dollars). The recession that began at the end of 2019, which was aggravated by the COVID-19 pandemic, completely dominated in 2020. Nevertheless, the result for 2020 was a record for the period since 2011 (1856,092 billion dollars). In 2021, the increase became even more significant (this year the growing tension of the situation around Ukraine contributed to the growth of military spending).
With the beginning of a special military operation in Ukraine by Russia on February 24, 2022, almost all NATO countries announced plans for a sharp increase in military spending in 2022 and in the future, and the SVO in Ukraine has actually become a confrontation between Russia and NATO.
This surge will occur against a background when most countries have not yet recovered their national economies after the COVID-19 pandemic, and this means a landslide militarization of the economies of the leading countries of the world.
The most "failed" for the period under review were 2015 ($1,565.057 billion) and 2016 ($1,579.435 billion). The largest volume of global defense spending was recorded in 2021 (1953.801 billion dollars). This is a record result in recent history.
In the near future (2022), it is possible to predict with a sufficient degree of certainty the situation with the fluctuation of global military spending. On the one hand, the COVID-19 pandemic has forced many countries to reduce military spending in order to redirect funds to restore national economies. On the other hand, a sharp aggravation of the international situation in several regions of the world at once, primarily in Ukraine, will definitely lead to the fact that despite the COVID-19 pandemic, many countries will increase their defense spending, although in many of them the economic situation is difficult. Describing the situation as a whole, it can be assumed that military spending in 2022 will significantly exceed the figures of 2021 (it can definitely be argued that by the end of 2022, world military spending will exceed $ 2 trillion for the first time in recent history). The forecast for 2023 and beyond on military spending is currently not possible, since the world is on the verge of World War III.
According to the CAMTO, in absolute terms (in the prices of each specific year) in 2014, the volume of world military spending amounted to $ 1,631.732 billion, in 2015 – $ 1,565.057 billion, in 2016 – $1,579.435 billion, in 2017 – $1603.849 billion, in 2018 – $1,686.976 billion. USD, in 2019 – 1773,809 billion. in 2020 – 1856,092 billion dollars and in 2021 – 1953,801 billion dollars.
In general, over the 8-year period (2014-2021), global military spending amounted to $13650.755 billion.
World GDP, according to the IMF, for the same period is characterized by the following figures (in the prices of each specific year): 78.355 trillion dollars in 2014, 74.194 trillion dollars in 2015 (a decrease of 5.31%), 75.230 trillion dollars in 2016 (an increase of 1.4%), $79.609 trillion in 2017 (an increase of 5.82%), $85.508 trillion in 2018 (an increase of 7.41%), $86.956 trillion in 2019 (an increase of 1.69%), $84.709 trillion in 2020 (a decrease of 2.58%) and 95.842 trillion dollars in 2021 (an increase of 13.14%).
In general, over an 8-year period, world GDP amounted to $660,402 trillion.
During the period under review, the annual percentage nominal growth of world GDP outpaced the growth rate of military spending in 2016-2018 and 2021. During this period, there was a tendency to revive the world economy.
During the period of instability of the world economy, the growth rate of military spending outstripped the growth rate of GDP due to a kind of "damper" on the execution of supplies under previously concluded contracts.
In general, the period under review was characterized by an increase in military spending. This growth was influenced by large-scale shocks in the region of North Africa and the Middle East, as well as the military operation of the NATO coalition in Libya, military operations in Iraq, Afghanistan and Syria.
The further development of the situation around Ukraine will have a very significant impact on the military spending of the countries of Western and Eastern Europe. As noted above, Russia's special military operation in Ukraine has already led to a collapse in military spending in NATO countries in 2022. In this regard, the previously announced level of mandatory military spending of 2% of GDP for the countries of Western and Eastern Europe will not only be achieved in the near future, but also overcome.
