Article by Sam Perlo-Freeman, Aude Fleurant, Pieter D. Wezeman and
Siemon T. Wezeman
Valentin Tzvetanov, Pan.bg editor’s remarks: The information has been taken from Stockholm International Pease Research Institute (SIPRI) Fact Sheet, April 2015
Global military expenditure in 2014 was an estimated $1776 billion, representing a marginal fall of about 0.4 per cent in real terms compared to 2013.1
Total expenditure was equivalent to 2.3 per cent of global gross domestic product (GDP). This is the third consecutive year that total global military expenditure has decreased. However, the falls during the previous two years have been comparatively small; world military expenditure is still only 1.7 per cent below its 2011 peak, and it remains signifi cantly above the levels of the late 1980s (see fi gure 1).
The pattern of the past few years - whereby military expenditure has fallen in the United States and Western Europe, but increased elsewhere - largely continued in 2014, although spending in Latin America was essentially unchanged. Spending in Central Europe broke with recent trends and began to rise again following the large falls in previous years resulting from the global fi nancial crisis that began in 2008. Africa, Asia, Eastern Europe and the Middle East continued to see large increases. Excluding the USA, total military expenditure for the ‘rest of the world’ has increased continuously since 1998 and was up by 3.1 per cent in 2014.
From 13 April 2015 the SIPRI Military Expenditure Database includes newly released information on military expenditure in 2014. This Fact Sheet describes the global, regional and national trends in military expenditure that are revealed by the new data, with a special focus on countries with a military burden - that is, military spending as a share of GDP - of over 4 per cent.

The Top 15 Military Spenders in 2014
There was no change in the countries that comprised the top 15 military spenders in 2014 compared to 2013, although there were some changes in order (see table 1). India moved up from 9th position to 7th, exchanging places with Japan, while Brazil and Italy swapped places at 11th and 12th. While the USA remains clearly the world’s largest military spender, at nearly three times the level of second-placed China, its expenditure dropped by 6.5 per cent in 2014, largely as a result of budget defi cit control measures put in place by the US legislature under the 2011 Budget Control Act. US military spending is expected to fall again in 2015 but at a slower rate.
Since reaching its highest recorded peak in 2010, US military expenditure has decreased by 19.8 per cent in real terms. The USA’s share of world military expenditure remains high at 34 per cent, but it is declining steadily year on year as the USA reduces its spending and other states increase expenditure (see fi gure 2). Nevertheless, US military spending continues to run at historically high levels and is around the same level in real terms as at its previous peak in the late 1980s.
In 2014 China, Russia and Saudi Arabia were the second, third and fourth highest military spenders, respectively. China’s expenditure rose by 9.7 per cent, Russia’s spending was up 8.1 per cent and Saudi Arabia’s by 17 per cent. China’s military spending has generally kept pace with its economic growth rate, with military expenditure remaining, by SIPRI’s estimate, a fairly steady share of GDP of between 2 per cent and 2.2 per cent over the past decade.
The huge increase in Saudi Arabia’s spending is a refl ection both of the continuing confl ict and instability in the surrounding region, and of the revenues
available to the government from the high price of oil that prevailed until late 2014. The drastic fall in oil prices in the latter part of 2014 may aff ect Saudi Arabia’s ability to maintain these expenditure levels in the medium term. In the short term, however, Saudi Arabia can rely on its very large fi nancial reserves to fund further spending. Meanwhile, Russia has already cut its planned military spending in 2015 by 5 per cent as a result of falling oil revenues, despite its involvement in the confl ict in Ukraine and increasingly hostile relationship with the West.
Russia’s military budget for 2015 is nonetheless still around 15 per cent higher in real terms than spending in 2014.
Among other countries in the top 15, Australia also made a substantial increase in spending of 6.8 per cent, following three years of cuts, and there were small increases by India (1.8 per cent) and South Korea (2.3 per cent). Meanwhile, Italy’s expenditure fell by 8.8 per cent; as Italy is one of the European countries experiencing economic diffi culties due to the global fi nancial crisis, its spending has now decreased by 25 per cent since the crisis began in 2008. There were smaller falls in the United Arab Emirates (UAE, 5.5 per cent), Germany (3.3 per cent) and Brazil
(1.7 per cent), with very little change in France, the United Kingdom, Japan
and Turkey.

Regional trends
Asia and Oceania
Military spending in Asia and Oceania increased by 5 per cent in 2014 and by 62 per cent between 2005 and 2014, reaching $439 billion in 2014 at current prices and exchange rates (see table 2). In 2014 the growth of 9.7 per cent in China’s expenditure dominated the regional trend, with the overall increase in the rest of the region standing at just 1.2 per cent.
Viet Nam also continued its rapid rise in military spending, with an increase of 9.6 per cent in 2014, reaching $4.3 billion. Since 2005 Viet Nam’s spending has risen by 128 per cent, refl ecting tensions with China over territorial disputes in the South China Sea. However, Indonesia, another South China Sea littoral state, decreased its spending by 10 per cent in 2014 - a reversal of recent trends, which may prove to be only temporary, given Indonesia’s ambitious military modernization plans.
Although military spending in Asia and Oceania remains on an upward trend - with all states in the region except Fiji, Japan and Laos increasing their spending since 2005 - the growth rate for most states has been substantially lower since 2009, when the eff ects of the global fi nancial crisis began to be felt. For example, while China’s military expenditure doubled in real terms between 2004–2009, it increased by only
48 per cent between 2009-14. Likewise, while India’s military expenditure increased by 45 per cent between 2004–2009, it has remained essentially fl at since then, increasing by just 2 per cent. Overall, since 2009, three times as many countries in Asiaand Oceania have slowed (or reversed) their rate of increase in military expenditure as have increased their rate of growth. In the region as a whole, the growth rate slowed from 41 per cent in the period 2004–2009, to 21 per cent in the period 2009-14.

Europe
Military expenditure in Europe increased by 0.6 per cent in 2014, reaching $386 billion see (table 3). The total was 6.6 per cent higher than in 2005. In Eastern Europe spending was up 8.4 per cent in 2014, reaching $93.9 billion, while in Western and Central Europe the total was down 1.9 per cent at $292 billion. Since 2005 Eastern European spending has increased by 98 per cent, while that in Western and Central Europe hasfallen by 8.3 per cent.
In Eastern Europe, SIPRI’s provisional estimate for Ukraine’s military spending in 2014 shows an increase of 23 per cent over 2013; this is much higher than the original budget estimates and is in response to the confl ict in the east of country, which is probably still not fully accounted for in the latest fi gures. Russia’s military spending also grew by 8.1 per cent to $84.5 billion, but Russia had planned for this increase before the start of the crisis in Ukraine. Ukraine has doubled its budget for the armed forces in 2015 in real terms, while Russia also plans a rise of about 15 per cent.
In Western Europe the downward trend resulting from austerity policies continued in most countries in 2014. However, in Central Europe, Poland increased spending by 13 per cent, mostly due to its major military modernization programme for 2013–22. Several other countries in the subregion also raised expenditure, including the Baltic states, which have begun to reverse the heavy reductions in spending that followed the global fi nancial crisis.
Increases in many Central European countries, as well as some of the Nordic countries, are likely to continue in 2015, in part as a reaction to the crisis in Ukraine (see SIPRI media briefi ng ‘Military spending in Europe in the wake of the Ukraine crisis’).

The Middle East
Military spending in the Middle East amounted to $196 billion in 2014, an increase of 5.2 per cent over 2013, and 57 per cent since 2005 (see table 4). The largest increases since 2005 were by Iraq (286 per cent), the UAE (135 per cent), Bahrain (126 per cent) and Saudi Arabia (112 per cent). Figures for 2014 were not available for Kuwait, but its spending increased by 112 per cent between 2005 and 2013. All these countries are major oil producers, and their state revenues were boosted by high oil prices over the period. Military expenditure budgets of states in the region may be aff ected by the fall in the price of oil in late 2014, but any eff ects will likely be mitigated by the strong financial reserves built up by many countries following several years of high oil prices.

In contrast, Turkey’s spending grew by just 15 per cent since 2005, while Israel’s military spending remained relatively stable throughout 2005–14. Based on data available, Israel’s spending decreased by 8 per cent from 2013 to 2014; however, the fi nal fi gure for 2014 is likely to be substantially higher as the current estimate may not fully cover the costs of the war in Gaza in 2014. The last available figure for Qatar’s military expenditure dates from 2010 when it stood at $1.9 billion. However, Qatar started a major expansion of its armed forces in 2012 and announced orders for weapons worth $23.9 billion dollars in 2014, suggesting a substantial increase in its military spending since 2010.

Latin America and the Caribbean
Latin American military expenditure was essentially fl at in 2014. Total military spending in South America was $67.3 billion, down 1.3 per cent in real terms since 2013, but 48 per cent higher than in 2005; in Central America and the Caribbean the total was $10.4 billion, up 9.1 per cent over 2013, and 90 per cent since 2005 (see table 5).
Brazil’s military spending fell by 1.7 per cent, as the economy slowed and the government faced major social protests over the lack of basic services in the run-up to the 2014 soccer World Cup. GDP growth in 2014 was projected to be just 0.3 per cent, with only a slow recovery in 2015 to 1.4 per cent.
Nonetheless, Brazil’s spending was still 41 per cent higher than in 2005 and has continued on a fairly consistent, if uneven, upward trend since the mid-1990s. This general increasing trend represents Brazil’s ongoing military modernization programme. In 2014 this included the signing of a contract to purchase 36 combat aircraft from Sweden for $5.8 billion. Meanwhile, Mexico’s military spending increased by 11 per cent in 2014 and has now more than doubled since 2005. A further rise of 10 per cent (8 per cent in real terms) is budgeted for 2015. Both military and security expenditure have increased rapidly as Mexico continues to use its armed forces, regular police and a newly created 5000-strong gendarmerie in its actions against drug cartels.

Africa
Africa once again saw the largest year-on-year increase in military expenditure of any region, at 5.9 per cent, reaching $50.2 billion in 2014 (see table 6). Military spending in the region has increased by 91 per cent since 2005. Africa’s two biggest spenders, Algeria and Angola, continued their rapid military spending increases financed by high oil revenues, with Algeria increasing by 12 per cent to reach $11.9 billion, and Angola by 6.7 per cent to hit $6.8 billion. These countries have respectively trebled and doubled their spending in real terms since 2005, and both now spend more than
5 per cent of their GDP on the military. It remains to be seen whether the crash in oil prices in late 2014 will halt this trend. Nigeria’s budgeted military expenditure fell in 2014 for the third year running, by 9.3 per cent, to $2.3 billion. Nonetheless, the total is still 79 per cent higher than in 2005, and the budgeted fi gure does not include a $1 billion loan approved by the Nigerian Congress in October 2014 for military hardware and training to fi ght the militant group Boko Haram. However, it is debatable whether extra funding for the military on its own will prove eff ective, given the rampant corruption in the Nigerian armed forces and alleged human rights abuses by Nigerian soldiers that have alienated much of the local population. Such
factors have severely impeded the fi ght against Boko Haram so far.

Countries with high military expenditure as a share of GDP
A country’s military expenditure as a share of GDP - also known as the military burden - is the simplest measure of the relative economic burden the military places on the country. In general, most countries worldwide have seen a decline in their military burdens since the end of the cold war, although this trend has slightly reversed in recent years. In 2014 about 55 per cent of countries for which SIPRI had data had military burdens below 1.5 per cent of GDP.
However, there is very wide variation in military burdens, and in 2014 there was a sharp increase in the number of countries with military burdens over 4 per cent of GDP, as well as in countries with military burdens over 5 per cent. In total, 20 countries had military burdens over 4 per cent of GDP in 2014 - or in the most recent year when data was available (2011 or later, see fi gure 4). Of these countries, 10 had military burdens over 5 per cent.2
The countries are very diverse in size (from Armenia with a population of 3 million to Russia with 143 million) as well as in absolute levels of military spending (from just $0.5 billion to over $80 billion in 2014). The Middle East is heavily over-represented, with 9 of the 20 countries in the list, including the top 2, representing a majority of the states in the region. There are 7 African countries, almost all of which have increased their military burden noticeably since 2005. Of the remaining countries, 3 are from Eastern Europe (Armenia, Azerbaijan and Russia) and 1 (Myanmar) is from Asia. In 2014, within Western and Central Europe, Serbia had the highest military burden at 2.3 per cent, and in the Americas the USA was the highest at 3.5 per cent.
By way of comparison, only 13 countries had a military burden over 4 per cent in 2005 (including Eritrea, for which data was not available in 2005, but which had a military burden of 21 per cent in 2003 - the year closest to 2005 where comparable data was available). Burundi, Djibouti, Jordan, Kuwait and Singapore have fallen below 4 per cent of GDP since 2005.
A common feature of the great majority of the countries in the list is a lack of eff ective democracy. The Polity IV dataset, produced by the Center for Systemic Peace, is one of the most widely used academic datasets for measuring levels of democracy and autocracy in diff erent states since the early 19th century. Of the 20 countries in fi gure 4, only 3 (Israel, Lebanon and Namibia) were classed as ‘democracies’ in 2013 by Polity IV, although 56 per cent of countries worldwide were classed as such. Conversely, 6 out of the 20, or 30 per cent, were classed as ‘autocracies’, compared to 13 per cent worldwide. Of the remaining 11, 2 (Libya and South Sudan) were classed as ‘failed states’, while 9 had a rating between democracy and autocracy (compared to 29 per cent of states worldwide).
Of the 20 countries, 11 were engaged in war or minor armed confl ict in 2013 or 2014. Thus, while confl ict was a common feature, it was not ubiquitous.
However, several of the other countries have a recent history of confl ict, often with continuing high tensions.
One country, Namibia, stands out as being a functioning democracy that has not suff ered armed confl ict since 1990, yet still has a military burden of 4.6 per cent. Namibia made a 66 per cent increase in its defence budget in 2014 to improve living conditions for its soldiers. Namibia’s large geographical size and small population, which increases the relative cost of defending the country’s long borders and coastline, may partly explain its relatively high military spending in the longer term.

The SIPRI Military Expenditure Database provides military expenditure
data by country for the years 1988-2014
• in local currency, at current prices,
• in US dollars, at constant (2011) prices and exchange rates,
• as a share (%) of gross domestic product (GDP),
• per capita, in current US dollars, and
• as a share (%) of general government expenditure.
SIPRI military expenditure data is based on open sources only, including a SIPRI questionnaire that is sent out annually to governments. The collected data is processed to achieve consistent time series which are, as far as possible, in accordance with the SIPRI defi nition of military expenditure.
The database is available at <http>.

Where possible, SIPRI military expenditure data includes all current and capital expenditure on
• the armed forces, including peacekeeping forces,
• defence ministries and other government agencies engaged in defence
projects,
• paramilitary forces, when judged to be trained and equipped for military
operations, and
• military space activities.
Such expenditure should include
• military and civil personnel, including retirement pensions of military
personnel and social services for personnel,
• operations and maintenance,
• procurement,
• military research and development, and
• military aid (in the military expenditure of the donor country).
Civil defence and current expenditure on previous military activities - such
as veterans’ benefi ts, demobilization, conversion and weapon destruction - are excluded.

About the authors
Dr Sam Perlo-Freeman (United Kingdom) is a Senior Researcher with the SIPRI Arms and Military Expenditure Programme and Head of the Military Expenditure project.
Aude Fleurant (Canada/France) is Director of the SIPRI Arms and Military
Expenditure Programme.
Pieter D. Wezeman (Netherlands/Sweden) is a Senior Researcher with the SIPRI
Arms and Military Expenditure Programme.
Siemon T. Wezeman (Netherlands) is a Senior Researcher with the SIPRI Arms and
Military Expenditure Programme.