LONDON, 24 Feb. - (ANA) - Global defence spending grew in 2025, reaching USD2.63 trillion, up from USD2.48 trillion in 2024. Spending also rose in real terms by 2.5%. This uplift was driven by strong spending increases in Europe and the Middle East, according to the 67th edition of these International Institute of Strategic Studies' Military Balance.

 

 

NATO’s eastern flank faces growing Russian ‘grey zone’ threats, including UAV incursions and sabotage. In response, frontline states have launched layered defensive programmes that combine fortifications, surveillance systems, and short-range air defences to better defend their borders. 

 

 

 

 

- The United States' defence policy has pivoted to homeland defence and burden-shifting

 

- Global defence spending reached USD2.63 trillion, rising 2.5% year on year

 

- Four years on from the 2022 invasion of Ukraine, Russia’s marginal territorial gains continue to come at a high cost. However, Russia has been able to adapt, regenerate and maintain its capability

 

- Growth in trackable Russian military expenditure has moderated compared to previous years, reaching just 3% in real terms in 2025. Nonetheless, military spending still accounts for 7.3% of GDP

 

- Europe's share of total global spending is now at 21% with Germany’s increase accounting for a quarter of all European growth since 2024

 

- Chinese military spending growth still outpaces the rest of Asia. As a result, Beijing’s share of the regional total grew to almost 44% in 2025, up from an average of 37% between 2010 and 2020

 

- Despite the recent purge within the People's Liberation Army (PLA) command structure, there appears to be little impact on Chinese capabilities

 

 

 

 

In its 67th edition, The Military Balance 2026 examines the effects on the United States, its allies and the wider world. US defence policy is increasingly focussed on homeland defence, exemplified by proposals for a multi-layered “Golden Dome” missile-defence system. Direct US support for Ukraine has been curtailed while at the same time, US forces face growing strain from simultaneous commitments in the Caribbean, the Indo-Pacific and the Middle East.

 

Europe’s share of global defence spending has increased sharply to 21%, up from 17% in 2022, reflecting sustained growth as the continent responds to both Russian aggression and reduced US willingness to underwrite regional security. 

 

While German spending increases are largely driving that rise, there were also significant budget uplifts in Belgium, the Nordic countries and Spain. Despite further increases expected across the region in 2026, procurement reform in general remains relatively slow and insufficiently innovative.

 

Efforts to reinforce NATO’s eastern flank are under way, but addressing air and missile defence shortfalls remains a priority. Limited industrial capacity and the challenges of scaling production remain constraints on European rearmamentno.

 

Russia’s war against Ukraine continues to impose severe costs on Moscow. Despite achieving only limited territorial gains with heavy casualties, Russia has been able to sustain the size of its deployed forces and has pushed defence spending to record levels in the years immediately after 2022.  This is now triple the figure in 2021, despite a slowdown in growth in 2025. 

 

China’s sustained military activity around Taiwan continues, despite an ongoing internal anti-corruption campaign within the PLA. Its technological developments were showcased at the “Victory Day” parade in September, where systems on show included the now operational JL-1 air-launched ballistic missile. 

 

The PLA Navy commissioned its largest and most capable aircraft carrier, the Fujian, along with at least nine new major surface combatants. Ten new nuclear-powered submarines were launched between 2021 and 2025, outpacing the US Navy both in terms of hulls and tonnage during that timeframe. Furthermore, Chinese-origin aircraft and weapons were put to the test operationally by Pakistan’s military in its conflict with India. 

 

Consistent uplifts in the Chinese defence budget over the last decade have outpaced growth in the wider region and Beijing’s share of regional spending has grown to almost 44% in 2025, up from an average of 37% between 2010 and 2020.

 

In the Middle East and North Africa, US defence partnerships with the Gulf states have strengthened, particularly with Qatar, Saudi Arabia and the United Arab Emirates. Regional defence spending reached USD219 billion, with countries spending an average of 4.3% of GDP.   - (ANA) -

 

AB/ANA/24 February 2026 - - -