NATO Members Drive Fastest Increase in Global Defense Spending for a Decade


Reading time ( words)

Strong Economic Conditions in Asia-Pacific Drive Accelerated Growth

Growth in Asia-Pacific accelerated to 3.6% in 2018 but remains below the average 4.8% rate seen over the past decade. Total regional spending reached a record high of $465 billion in 2018.

Despite security concerns, economic growth continues to be the primary driver of defense budget growth in Asia.

“Strategic drivers are undoubtedly becoming more important, but trends continue to be dictated by economic and fiscal conditions. Strong underlying economic fundamentals mean that Asia is where we expect the majority of the sustainable long-term growth will come from,” Caffrey said. “From a budgetary perspective, we’re still seeing very few indicators that an arms race is underway in Asia”.

Saudi Surpasses France as Fifth Largest Defense Spender

Higher oil prices over the course of 2018 contributed to an uptick in growth in the Middle East and North Africa with total spending in the region reaching $180 billion. Saudi Arabia increased its defense outlay by 7% to hit $56 billion, making the Kingdom the fifth largest spender on defense globally.

“The large increase in Saudi Arabia’s defense budget drove trends in MENA,” Caffrey said. “With oil prices falling again in the latter part of the year, regional growth is likely to remain relatively conservative in the short term.”

Brazil Dominates Defense Spending In Latin America

Latin America’s defense spending grew 10.4% in 2018, reaching a new high of almost $62 billion. Brazil’s allocation of $29.9 billion accounted for 48.3% of this total.

“The recovery in Latin American defense budgets continued this year, but aside from Venezuela, where hyperinflation necessitated massive spending supplements, growth was markedly slower than in 2017,” said Andrew MacDonald, senior analyst at Jane’s.

Share

Print


Suggested Items




Copyright © 2020 I-Connect007. All rights reserved.