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24 April 2024

TRENDS IN WORLD MILITARY EXPENDITURE, 2023

Nan Tian, Diego Lopes Da Silva, Xiao Liang and Lorenzo Scarazzato

World military expenditure increased for the ninth consecutive year in 2023, reaching a total of $2443 billion. The 6.8 per cent increase in 2023 was the steepest year-on-year rise since 2009 and pushed global spending to the highest level SIPRI has ever recorded (see figure 1). The world military burden—defined as military spending as a percentage of global gross domestic product (GDP)—increased to 2.3 per cent in 2023. Average military expenditure as a share of government expenditure rose by 0.4 percentage points to 6.9 per cent in 2023 and world military spending per person was the highest since 1990, at $306.

The rise in global military spending in 2023 can be attributed primarily to the ongoing war in Ukraine and escalating geopolitical tensions in Asia and Oceania and the Middle East. Military expenditure went up in all five geographical regions, with major spending increases recorded in Europe, Asia and Oceania and the Middle East.

and Oceania and the Middle East. This SIPRI Fact Sheet highlights trends in military expenditure for 2023 and over the decade 2014–23. The data, which replaces all military spending data previously published by SIPRI, comes from the updated SIPRI Military Expenditure Database.

THE WORLD’S LARGEST MILITARY SPENDERS IN 2023

World military expenditure is highly concentrated among a relatively small group of states (see table 1). The two largest spenders, the United States and China, accounted for around half of global military spending in 2023 (see figure 2). Together, the top 10 in 2023 accounted for almost three quarters (74 per cent) of the world total, or $1799 billion, which was $105 billion more than the previous year. In 2023 all countries in the top 10 increased their military spending. The biggest percentage increase among this group was in Ukraine. Its military spending went up by 51 per cent to $64.8 billion and it moved from 11th largest spender in 2022 to 8th largest in 2023.

The military burden of every country in the top 10 grew in 2023. The largest increase was in Ukraine, where military spending as a share of GDP rose by 11 percentage points to reach 37 per cent. This was followed by Russia with an increase of 1.2 percentage points in its military burden to 5.9 per cent of GDP. Military spending as a share of government expenditure, which can be seen as a measure of government priorities, increased in 9 of the top 10 spenders in 2023 (the only decrease was in the USA). Among the top 10, military spending as a share of government expenditure was highest in Ukraine (58 per cent), followed by Saudi Arabia (24 per cent) and Russia (16 per cent). The most notable increases in 2023 were in Ukraine (+19 percentage points) and Russia (+3.2 percentage points).

US military spending was $916 billion in 2023, which was 2.3 per cent more than in 2022 and 9.9 per cent more than in 2014. The USA remained by far the largest spender in the world, allocating 3.1 times more to the military than the second largest spender, China. The biggest percentage increase among all US military spending categories in 2023 was for ‘research, development, test and evaluation’ (RDT&E). The USA spent 9.4 per cent more in real terms on RDT&E than in 2022. The USA has prioritized RDT&E spending, in relative terms, over all other military spending categories since around 2014. This aligns with its decision to shift its focus away from counterinsurgency operations and asymmetric warfare to developing new weapon systems that could be used in a potential conflict with adversaries with advanced military capabilities.

Military aid to Ukraine was a highly debated topic in the USA in 2023. Funding allocations beyond those in the initial US Department of Defense budget were the main sources of US military spending related to Ukraine in 2023. They totalled $35.7 billion in 2023, of which $25.4 billion was in the form of military aid—the largest amount of military aid given to Ukraine by any country that year. The remaining $10.3 billion in Ukraine-related allocations included funds to support European allies and US command operations in Europe and to boost US munitions production capacity to replenish stocks sent to Ukraine and meet Ukraine’s ammunition needs.

China, the world’s second largest military spender, allocated an estimated $296 billion to the military in 2023, an increase of 6.0 per cent from 2022. China’s military expenditure accounted for 12 per cent of global spending and 50 per cent of spending in Asia and Oceania. Aside from being the biggest spender in Asia and Oceania, China is the main driver of spending trends elsewhere in the region since many of its neighbours perceive China’s growing military power as a reason to enhance their own military capabilities. China’s military expenditure has risen consecutively for 29 years, the longest unbroken streak recorded by any country in the SIPRI Military Expenditure Database. However, the rate of military spending growth has slowed over the past 10 years: China recorded an increase of 60 per cent in 2014–23 compared with increases of just under 150 per cent in 2004–13 and 1994–2003. This also reflects the slower rate of Chinese economic growth during the past decade. China recorded single-digit growth in its military spending for the 11th consecutive year in 2023, which was largely in line with its annual GDP growth over the same period.

At an estimated $109 billion, Russian military expenditure in 2023 was 24 per cent higher than in 2022 and 57 per cent higher than in 2014, when Russia annexed Crimea. In 2023 Russia’s military spending was equivalent to 5.9 per cent of GDP and 16 per cent of total government expenditure, which were the highest levels recorded by Russia since the dissolution of the Soviet Union. Figures for Russia’s military expenditure in 2023 are highly uncertain due to the increasing opaqueness of Russian financial authorities since the full-scale invasion of Ukraine in 2022. In addition to the state budget, funding to support the invasion has come from off-budget revenue streams such as businesses, individuals and organizations. While these contributions are probably modest compared with the official budget, the lack of information about them means that SIPRI’s military expenditure figures for Russia are underestimates.

The increase in Russian military expenditure in 2023 was largely facilitated by Russia’s economic performance, which surpassed expectations despite a significant fall in the country’s oil and gas revenue. Russia has relied on its sovereign wealth fund and state loans to finance its expanding budget deficit, which has allowed it to limit the impact of its full-scale invasion of Ukraine on its economy.

on its economy. In its draft budget for 2023, published in September 2022, Russia increased the amount allocated to ‘national security and public order’ by 50 per cent compared with 2022. This suggests that Russia expected the war in Ukraine to have wound down significantly during 2023 with a subsequent transition towards control of annexed territory. In a possible reassessment of the state of the full-scale invasion, in December 2022 Russia issued a revised 2023 budget that increased funding to ‘national security and public order’ by only 21 per cent compared with 2022. Based on the draft state budget for the years 2024–26, published in 2023, Russian military spending is expected to continue to rise in the coming years.

With military expenditure of $83.6 billion in 2023, India was the fourth largest spender globally. Indian spending was up by 4.2 per cent from 2022 and by 44 per cent from 2014. The increase in India’s military spending was mainly a result of growing personnel and operations costs, which made up almost 80 per cent of the total military budget in 2023. This aligns with the government’s priority to strengthen the operational readiness of the armed forces amid ongoing tensions with China and Pakistan. In comparison, capital outlays to fund military procurement remained relatively stable, at around 22 per cent of the budget in 2023. A total of 75 per cent of these outlays went towards equipment produced domestically, which was the highest level ever and up from 68 per cent in the previous year. The continued shift towards domestic procurement reflects India’s goal of becoming self-reliant in arms development and production.

Saudi Arabia was the fifth biggest military spender globally in 2023. Its spending rose by 4.3 per cent to an estimated $75.8 billion, or 7.1 per cent of GDP. Saudi Arabia is the world’s largest exporter of crude oil, and the growth in its military spending in 2023 was partly financed on the back of increased demand for non-Russian oil and rising oil prices following Russia’s full-scale invasion of Ukraine.

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