In this article, we will be looking at the countries with the highest military spending in the world. If you want to skip our detailed analysis of the worldwide military spending trends, you can go directly to the 5 Countries with the Highest Military Spending in the World.
Having a military counts as a hard power of a country. Apart from providing security to the national borders, the military also acts as a symbol of the state’s sovereignty and status quo. That is the reason why large countries all around the world spend billions of dollars on maintaining an active military.
Global spending on the military is recorded to be $1,981 billion in 2020. Out of this $1,981 billion expenditure, 81% is expended by the top 15 countries with the highest military spending. This global military expenditure is on the rise since 1988. Compared to 2019, 2.6% more had been expended on the military in 2020. The global spending on military formed 2.4% of the global GDP in 2020.
The top five countries with the highest military spending account for 62% of global military spending. Most of the countries in the following list of 25 countries with the highest military spending are from North Atlantic Treaty Organizations or NATO. Six of these countries, The US, The UK, Germany, France, Italy, and France, contribute 90% to the NATO military budget. They account for 50% of the global military spending. While most of the defense companies are not public, the US has some big names working in the defense industry such as Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS).
As far as the regions are concerned, the Americas with 43%, and Asia and Oceania with 27%, account for a two-third of the global military expenditure. Europe accounts for 19% while Africa has a small share of 2.2%. However, the percentage increase of military expenditure is the highest in Africa, with a 5.1% increase from 2019 to 2020. In Africa, the relative increase in the military budget is the largest in Uganda with a 46% increment from 2019 to 2020, followed by Chad with 31% and Montenegro with a 29% increment from 2019 to 2020.
Photo by Joel Rivera-Camacho on Unsplash
Our Methodology
In order to compile this list of countries with the highest military spending in the world, we have picked up the countries from Stockholm International Peace Research Institute’s open database of military spending of countries. The ranking is based on the spending of various countries in the year 2020.
So, without further delay, let’s explore the 25 Countries with the Highest Military Spending in the world.
Countries with the Highest Military Spending in the World
25. Indonesia
Military Spending: $9.4 billion
Indonesia ranks 25th in the list of countries with the highest military spending in the world. Its military spending lies at the third spot in the countries of the Association of Southeast Asian Nations. Over the period of 2019-20, military spending has increased by 5.4%. This increase has changed Indonesia’s ranking from 26th in 2019 to 25th in 2020. Indonesia spent 0.9% of its total GDP on the military in 2020.
24. Algeria
Military Spending: $9.7 billion
Algeria is a Muslim majority country in North Africa. Algeria is one of the largest countries in Africa due to its landmass. With an expenditure of $9.7 billion on the military, Algeria was the top country in Africa in terms of military spending in 2020. Over the period of 2011-2020, military spending has increased by 30%. Algeria spent 6.7% of its GDP on the defense budget in 2020.
23. Pakistan
Military Spending: $10.4 billion
Pakistan, a country in South Asia, had military spending of $10.4 billion in 2020, making it 23rd on the list of countries with the highest military spending in the world. Over the period of 2011-2020, military spending has increased by 55%. The country spent 4% of its GDP on the defense budget in 2020.
22. Singapore
Military Spending: $10.9 billion
Singapore, another ASEAN country, ranks 22nd on the list of countries with the highest military spending. The country spent 3.2% of its GDP on defense budget in 2020. The spending has increased by 3.2% over the period of 2019-2020. From 2011-20, military spending has increased by 23%.
21. Taiwan
Military Spending: $12.2 billion
Taiwan lies at a strategic location near the People’s Republic of China and spends $12.2 billion on the military budget, making up to 1.9% of Taiwan’s GDP. Over the period of 2019-20, the military budget has been increased by 5.5%. From 2011-20, the military budget has been increased by 12%.
20. The Netherlands
Military Spending: $12.6 billion
The Netherlands, a NATO member in Europe, is the 20th highest spender on the military budget. The Netherlands has only increased 1.8% of its military spending from 2019 to 2020, losing its position as the 19th highest spender in 2019. Over the period of 2011-2020, the military budget has been increased by 15%. In 2020, Netherlands spent 1.4% of its total GDP on its military. As a close member of NATO, the increase in the military budget will profit the defense companies like Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS).
19. Poland
Military Spending: $13.0 billion
Poland spent 2.2% of its GDP on military spending in 2020. With a military budget of $13 billion, Poland ranks 19th on the list of countries with the highest military budget in the world. Poland has increased its budget by 8.7% from 2019 to 2020. Over the period of 2011-20, the military budget has increased by 60%.
18. Iran
Military Spending: $15.8 billion
Iran is the 18th on the list of countries with the highest military budget in the world. Iran spent $15.8 billion, 2.2% of its GDP, on military activities. The military budget has decreased by 3% in the period of 2019-20 and 23% in the period of 2011-20. The main reason for this decrease is the weakening economy due to sanctions on the Iranian economy.
17. Spain
Military Spending: $17.4 billion
Spain is a NATO member and has spent 1.4% of its GDP on military activities in 2020. The spending has decreased by 0.2% in the period 2019-20. The military budget has increased by a mere 0.6% from 2011 to 2020.
16. Turkey
Military Spending: $17.7 billion
Turkey, a NATO country in eastern Europe, spent $17.7 billion on military in 2020. The military budget has decreased by 5% from the year 2019 to 2020. However, the budget has increased by 77% from 2011 to 2020, the highest among the 25 countries with the highest military budget in the world.
15. Brazil
Military Spending: $19.7 billion
Brazil is a South American country with military spending of $19.7 billion in 2020. The country ranks 15 on the list of countries with the highest military budget in the world. The country spent 1.4% of its GDP on military spending in 2020. Over the years of 2019-20, military spending has decreased by 3.1%. However, from 2011 to 2020, military spending has increased by 2.1%
14. Israel
Military Spending: $21.7 billion
Israel, a state in the Middle East, spends 5.6% of its GDP on the military budget. Military spending has increased by 32% from 2011 to 2020. The increase in military spending for 2019-2020 is recorded to be 2.7%. Israel is one of the major importers of military equipment from companies like Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS).
13. Canada
Military Spending: $22.8 billion
Canada spends 1.4% of its GDP on the military budget. With spending of $22.8 billion, the country ranks 13th on the list of countries with the highest military budget in the world. Over the period of 2019-20, military spending has increased by 26%. The increase in military spending is recorded to be 2.9% from 2019 to 2020. With this increase in budget, defense contractors like Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS) are set to profit in the future.
12. Australia
Military Spending: $27.5 billion
Australia ranks 12th on the list of countries with the highest military budget in the world. The country’s spending on defense has increased by 33% from 2011 to 2020. In the years 2019-20, military spending has increased by 5.9%.
11. Italy
Military Spending: $28.9 billion
Italy spent 1.6% of its GDP on military spending. The country ranks 11th on the list of countries with the highest military budget in the world. From 2011 to 2020, the military budget has decreased by 3.3%. However, Italy increased its military spending by 7.5% in 2020 as compared to 2019.
10. South Korea
Military Spending: $45.7 billion
South Korea, an Asian country, ranks 10th on the list of countries with the highest military budget in the world. The country has increased its military spending by 41% from 2011 to 2020. The country increased the military budget by 4.9% in 2020 in comparison to 2019.
As countries like South Korea boost their defense spending, companies like Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS) are set to profit in the future.
9. Japan
Military Spending: $49.1 billion
Japan spent $49.1 billion, 1% of its GDP, on the military budget. Military spending has increased by 1.2% over the period of 2019-2020. The country has only increased 2.8% of its budget from 2011-2020.
8. France
Military Spending: $52.7 billion
France is the 7th on the list of countries with the highest military budget in the world. With military spending of 2.1% of its GDP in 2020, the country increased its military budget by 2.9% in 2020 as compared to 2019. The country has increased its budget by 28% from 2011 to 2020. It is an important NATO member from the EU and hence benefits companies like Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS).
7. Germany
Military Spending: $52.8 billion
Germany is the largest country in the EU with respect to military spending in the year 2020. Germany spent 1.4% of its GDP on the military in 2020. The country increased its military spending by 5.2% in 2019-20. From 2011 to 2020, military spending has been increased by 28%.
6. Saudi Arabia
Military Spending: $57.5 billion
Saudi Arabia ranks 6th on the list of countries with the highest military budget in the world. With military spending of 57.5%, the country is spending 8.4% of its GDP on military activities. From 2019 to 2020, the country has decreased its military spending by 10%, which resulted in the loss of its position as the 5th on the list of countries with the highest military budget in the world in 2019.
As countries like Saudi Arabia boost their defense spending, companies like Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), Northrop Grumman (NYSE: NOC), General Dynamics (NYSE: GD), Raytheon Technologies (NYSE: RTX), and Leidos Holdings (NYSE: LDOS) are set to profit in the future.
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Disclosure: None. 25 Countries with the Highest Military Spending in the World is originally published on Insider Monkey.
