Spending rose by 9.4 percent globally compared to 2023, with 2024 marking the 10th year of consecutive spending increases.
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00:00So in 2004, global military spending increased by 9.4%. So this was really
00:05unprecedented. It was the highest year-on-year increase since the end of
00:10the Cold War. And we also saw spending increased in all regions in the world.
00:14It was really a global across-the-board trend and spending also increased in
00:20over 100 countries in the world, which is also really remarkable. So this really
00:24speaks to the heightened geopolitical tensions and also the fact of
00:29ongoing conflicts on global military spending.
00:35So this kind of unprecedented increase is going to really going to have very
00:39profound social economic and political impact because we've seen to fund the
00:44unprecedented increase in spending. Countries have had to make trade-offs in
00:50their budgetary decisions. For example, we've seen many European countries cutting
00:54other spending like international aid to fund the increase in military spending and
00:58also countries are trying to raise taxes or rely on loans or debt to fund the spending.
01:08In the case of Europe, the main drivers of its surge was, I guess, the war in Ukraine in the short term but also the security concern posed by Russia in the long term.
01:19So we saw that in the third year of the war, not only did Russia and Ukraine both continue to increase spending, but many of the ambitious announcements by European governments since the start of the war really start to materialize.
01:32With Trump's new term, but even before his election and inauguration, his previous criticism of NATO and also the possible of U.S. possibility of U.S. entanglement from NATO has already had a significant impact.
01:49So European countries were already trying to boost their strategic autonomy and self-reliance in arms production before Trump's election.
01:55We've seen a clear uptick of its monthly spending at the start of the war in Gaza in October 23 and the start of the war in southern Lebanon in October 24.
02:13So this will largely, the trend, the future trend of Israel spending will largely rely on the outcome of the peace deal in the Middle East, but in the case of Iran and many other countries in the Middle East, I would say the expected increase did not happen in 2024.
02:36China continued to be the second largest spender globally, and it has increased spending every year for the last 30 years, and so this was mostly driven by China's long term commitment to modernization by 2030.
02:55So they are investing heavily in all demands across the board, its nuclear arsenal, aircraft, UAV drones, and cyber capabilities, and this also has a ripple effect across the Indo-Pacific region.