The three top spenders – the United States, China and Russia – spent a combined total of US$1.48 trillion, just over half of global expenditure.
Spending rose by 2.9% compared with 2024, despite a reduction by the US, the world’s biggest spender, according to a report by the Stockholm International Peace Research Institute (SIPRI).
Researcher Lorenzo Scarazzato told AFP the decrease from the US was more than offset by increases in Europe and Asia, as the world marked “another year of wars and increased tensions”.
Scarazzato said this was also reflected in the global “military burden” – the share of worldwide GDP devoted to military spending – which reached its highest level since 2009.
“Everything points to a world that feels less secure and is spending on its military to compensate for the global landscape,” he said.
The US spent US$954 billion, 7.5% less than in 2024, largely because no new financial military aid to Ukraine was approved. By contrast, Washington pledged a total of US$127 billion to Kyiv over the previous three years.
But the decrease is expected to be short-lived as the US Congress has approved spending of over US$1 trillion for 2026, which could rise to US$1.5 trillion in 2027 if US president Donald Trump’s budget proposal passes.
The main driver of the global increase was Europe – including Russia and Ukraine – where spending surged 14% to US$864 billion.
“That is driven by two major factors. One is the ongoing war in Ukraine, and the other is the decreased US engagement with Europe,” Scarazzato said.
He explained that the US is “pushing for Europe to take more care of its own defence”.
Germany, the fourth-largest spender, raised expenditure by 24% in 2025 to US$114 billion.
Spain also recorded a 50% jump to US$40.2 billion, pushing military spending above two percent of GDP for the first time since 1994.
Middle East tensions
The ongoing war in Ukraine saw both Russia and Ukraine increase their military spending, with each recording the highest share of government spending allocated to the military.
Russia’s spending rose 5.9% to US$190 billion, equivalent to 7.5% of GDP.
Ukraine meanwhile boosted spending by 20% to US$84.1 billion – a staggering 40% of GDP.
Despite persistent tensions in the Middle East, expenditure in the region rose only marginally, by 0.1 percent, to US$218 billion.
While most countries in the region increased spending, Israel and Iran actually recorded declines.
In Iran, it fell 5.6%t to US$7.4 billion, but this was mostly due to high annual inflation of 42%. In nominal terms, spending actually rose.
Israel’s 4.9% drop to US$48.3 billion reflected a reduced intensity in the Gaza war after a January 2025 ceasefire deal, the researchers explained, while noting Israeli spending was still 97% higher than in 2022.
In Asia and Oceania, spending reached US$681 billion, an 8.5% increase from 2024 – the region’s largest annual increase since 2009.
Scarazzato said the “major player” in the region was China, which has been increasing spending every year for the past three decades, and spent an estimated US$336 billion in 2025.
“But perhaps what’s interesting is the reaction of some other states, such as South Korea, Japan, and Taiwan, reacting to the threat perception,” he said.
Japan raised military expenditure by 9.7%, to US$62.2 billion in 2025, equivalent to 1.4% of GDP – its highest share since 1958 – while Taiwan increased its spending by 14% to US$18.2 billion.