Trends in the development of the global military economy
At the present stage, there is a significant increase in the mutual influence of the world economy and the global military-political situation. Today, it is economic interests that largely determine the direction and nature of the development of interstate relations.
At the same time, there is an increasing influence of political factors on economic processes, manifested in attempts by individual States to use economic methods, instruments of financial, trade and investment policy to solve their geopolitical problems. Such actions against the background of structural imbalances in the global economy and financial system, against the background of growing sovereign debt, against the background of volatility of the energy market actualize the risks of a repeat of large-scale financial and economic crises, weaken the stability of the system of international relations as a whole.
Global economic and political development trends, which form interstate contradictions, increase the role of the force factor in international relations, which is reflected in the military economy of the world's states.
FINANCING
Currently, the most significant trends characteristic of military financing of leading foreign countries include the following:
– maintaining the level of militarization of the economy within the indicators of previous years with a noticeable increase in the level of militarization of public finances in China, Japan and Germany;
– reduction of the share of military financing in government spending in Western European countries with a significant increase in total military spending in China;
– an increase in the growth rate (or a decrease in the rate of decline) of total military spending in Western European countries and in the United States, while their reduction in China;
– the gradual increase in military spending in leading Western countries is associated with the beginning of comprehensive technical re-equipment programs, the refusal to reduce the size of the armed forces, and the increase in forward basing costs;
– priority of applied research on the creation of new models of aviation equipment, missile weapons and hardware and software systems for cybersecurity in the allocation of funds for research and development (R&D).
Thus, in 2018-2022, the volume of total military expenditures in leading foreign countries was mainly reduced with a gradual change in the trend in a positive direction. A constant significant increase in the indicator was noted only in China, where the increase over the specified period amounted to more than $ 20 billion.
In the United States and in Germany, the termination of the sequestration of military spending has been recorded since 2016. Conditions are being created for increasing military financing in Japan and France.
There is a general tendency to maintain the level of militarization of the economy within the indicators of previous years (with the exception of the UK, where there is a steady downward trend). Nevertheless, the share of total military expenditures from the UK's GDP remains one of the most significant among the countries under consideration and amounts to 2.1%.
In 2018-2022, there is an increase in the level of militarization of public finances in China, Japan and Germany. In the United States, this indicator is stable, while in the UK and France it is declining. At the same time, the public finances of the United States, Germany and France are militarized to the greatest extent.
FINANCING VOLUMES AND COST STRUCTURE
The noted changes affected the distribution of countries by the share of total military expenditures in total global military expenditures. The United States, China, the Russian Federation and Germany retained their positions in 2018-2022. At the same time, Saudi Arabia and India have significantly risen in the ranking, while Japan, Great Britain and France are largely inferior to them. It is noteworthy that South Korea has entered the top ten world leaders in terms of military financing.
In order to identify the impact of the global military-political situation on military financing, the distribution of funds of the main budget recipients (military departments) by purpose and types of armed forces is of particular interest.
For example, the Ground Forces continue to lead in terms of funding in China, Japan and Western European countries - with the exception of Germany, where priority is given to the Air Force.
There is a growing trend towards an increase in the share of expenditures unclassified by type of armed forces, which is associated with the financing of the most important programs under the direct control of military departments. This process is most developed in the Western European NATO countries, where 50-70% of the budgets of the Ministries of defense are allocated for these purposes.
And yet, the main indicator of the reaction of states to an unstable military-political situation, which can have long-term consequences, is the target structure of expenditures of the Ministries of Defense. With the increase of negative factors of the military-political situation in the target structure, the share of expenditures on combat training and logistical support of troops and on technical equipment of the armed forces significantly increases.
Substantial amounts of funds allocated to meet the material needs of the armed forces allow us to maintain demand for samples, components and components of weapons and military equipment and support military production.
FASTER, HIGHER, MORE DIVERSE
The conducted research of the military industry of the leading countries of the world allowed us to identify the following trends:
– Reduction of the public sector in the United States and in Western European countries;
– consolidation of military-industrial companies, development of multinational corporations;
– a combination of the processes of specialization of production and diversification of economic activity;
– expansion of military-industrial cooperation;
– ensuring significant production volumes of weapons and military equipment in a wide range;
– allocation of significant funds for the development and development of the production of samples with high tactical and technical characteristics in the interests of ensuring the technical superiority of the national armed forces.
READINESS FOR MOBILIZATION OR THE PURSUIT OF PROFIT
There are significant mobilization capacities in the leading NATO countries and in China.
The greatest potential exists in the USA, Great Britain, France and Italy. In particular, the American capacity for the production of combat aircraft is about 1400 units, auxiliary aircraft – 500 units.
Only China has similar capabilities for the production of combat aircraft, but it is significantly inferior to the United States in other types of aircraft.
At the same time, another trend can be seen on the example of the United States – the development of export orientation of production in the interests of maintaining capacity and increasing the profitability of military production. Thus, during the analysis of the total production volumes of missile weapons by supply lines in the period 2007-2014, it was found that most types of American missiles were exported.
The only exceptions are strategic missiles, which were produced only for the national armed forces.
The share of other groups and types ranges from 4% (cruise missiles) to 65% (special missiles). In general, the share of export production for most types of missile weapons exceeds 30% of the total production volume, which, along with the fulfillment of national orders, allows enterprises to optimally load capacities and receive additional profits.
The development of cooperative ties forms another trend, especially relevant for European countries. More than 60% of international projects for the creation and production of weapons and military equipment are implemented by European companies.
For example, among the major projects stand out: the production of the A-400 military transport aircraft, NH-90 and LAH multi-purpose helicopters, the Typhoon multi-purpose fighter and the Aster anti-aircraft guided missile. Each of these projects involves the capacities of 10 to 300 companies from three to eight countries.
The largest program of interstate cooperation remains the production of the F-35 Lightning multipurpose fighter, which involved more than a thousand companies from nine countries.
THE REARMAMENT RACE AND THE INFLUENCE OF IMPORTERS
The main trends in the development of military-technical cooperation at the present stage include:
– expansion of the world market of armaments and military equipment in connection with the aggravation of the military-political situation and the beginning of new cycles of rearmament;
– stable composition of the leading exporting countries (at the same time, the export is dominated by products of the aviation industry, missile weapons and electronic equipment);
– maintaining stable volumes of supplies of components and components within the framework of military-industrial cooperation, exceeding the cost volumes of deliveries of finished samples;
– the use of military-technical cooperation as an opportunity to gain access to foreign technologies (especially characteristic of China, India, Japan).
The overall increase in the value volumes of the world market of IWT in 2018-2022 by 8% at constant prices compared to the previous five-year plan is caused by an increase in exports by the main suppliers by 10%, and imports of the main demand-generating countries by 30%.
The limited national markets of arms and military equipment of the leading countries have led to the strengthening of the position of importers.
In the geographical structure of exports, there is an increase in the shares of the USA, Germany and China, while maintaining the main composition of suppliers unchanged.
A significant increase in the share of Middle Eastern countries is recorded in imports, which is associated with negative changes in the situation in the region.
The changes in the commodity structure of exports of the main suppliers are insignificant: in the United States, it remained in the trend of the previous five-year plan, and in the countries of the European Union, an increase in the share of rocket and space technology was noted.
At the same time, more than half of the cost volumes in both European countries and the USA are provided by the supply of components.
conclusions
Thus, the current priority of the economic interests of States has a significant impact on their military economy.
In most countries, conditions are being created to increase the volume of military spending, a significant proportion of which is intended for the technical equipment of the armed forces, combat training and logistical support of troops. The military industry is actively developing with the maintenance of mobilization production capacities and the development of cooperative ties.
In general, maintaining a sufficiently high level of militarization of the economy of a number of leading states, building up and modernizing their power potential, creating and deploying new types of weapons destabilize the military-political situation in the world, undermine strategic stability, and pose a threat to global security.
In the long term, despite the fact that the risk of unleashing a large-scale war, including nuclear, between the leading states will remain low, the risks of their involvement in regional conflicts and the risks of escalation of crises will increase.
Vyacheslav Ivanov
Vyacheslav Viktorovich Ivanov is a military expert and historian.
