Virtual Public Discussion: Update on Global Military Spending

Ajouté : 2026-04-30

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[00:08:28]Good afternoon from Jakarta everyone.

[00:08:31]Welcome to FPCI's Middle Power Studies Network virtual public discussion. For those of of you who are new, allow us to briefly introduce Foreign Policy Community of Indonesia and the Middle Power Studies Network. FPCI is an independent nonpartisan organization which since its establishment in 2014 has grown to become the largest grassroots foreign policy group in Indonesia, Southeast Asia, and the Indo-Pacific.

[00:08:58]In 2023, FPCI established the Middle Power Studies Network, a unit dedicated to studying the evolving role of Middle Powers in shaping regional and global affairs. Today we are pleased to welcome over 200 registrants from over 20 countries tuning in virtually. To name a few, we have audiences from Australia, Brazil, Germany, Indonesia, the Philippines, South Korea, Switzerland, the United States, and Ukraine amongst others. We would we would also like to welcome our colleagues from the diplomatic corps, think tanks, academic community, and universities who are also tuning in to today's discussion.

[00:09:39]Today's discussion is titled update on global military spending trends 2026.

[00:09:45]For this we would like to welcome our speaker Dr. Nantan, senior researcher and program director of the super military expenditure and arms production program. Welcome Dr. Nantian. Thank you for joining us from Stockholm.

[00:10:01]>> Hi. Um good morning, good afternoon, uh maybe good evening to some others. Uh everyone um uh thank you for giving me the opportunity to speak about this latest uh report that we published uh on Monday. Um but before I start perhaps it would be a good idea to for those that don't know CRI or the databases to give everyone a brief background information about what we do um going into the the report uh itself. So the CRI databases and CRI was founded in 1966 uh with the rationale of providing essentially impartial data uh on the and the information on armaments as a as used as a solless basis for factual account on the contribution controversial subject of arms race and attempts to stop it. So during the the the height of the the cold war um the establishment of course the database has been become essentially international authoritative source um that is free publicly available to everyone that uses it and has been used uh in research uh policy across um the world and is currently as the database stands the most reputable open source and publicly available information on global armaments that you can find um around the world. Um the military spending data itself uh the definition that we will be talking about today uh very much is uh um providing data and on an easily identifiable measure on the scale of resources absorbed by the military. Um this data essentially includes all current and capital expenditure on the armed forces including peacekeeping forces expenditure by the defense ministry paramilitary forces that are judged or trained uh to and equipped uh to serve military purposes and operations and military space activities. And within this uh we can see this as of course including personnel expenditure such as salaries, pension contributions to both military and civil personnel, procurement, research and development, military infrastructure such as military bases and military aid. Um and all the information that we have compiled for this report uh is from open sources and are all from primary sources such as uh national budget documents.

[00:12:19]Um so with this um let me get into the findings of the publication that was uh and the data that was released um on Monday. So I think starting off I mean I think we can all agree that we are really living in unprecedented times uh of you know turbulent geopolitics alliance dynamics uh great power competition a return to you know large scale interstate warfare and a sense of of course growing insecurity and a willingness to increase military spending as a means to achieve security through military strength and deterrence and I think it is on the back of this sentiment really that where you know I'll latest data and publication sits that global military spending in 2025 is again at a you know all-time high that has ever recorded at about 2.9 trillion um US dollars. Uh and and it's the 11th consecutive year that we have seen an increase in world spending. Um I think the issue with 2.5 $2.9 trillion is that it's such a large number it's very difficult to really understand how much money we're talking about. Um I think you know in in case of maybe an example of uh Indonesia is that it's equivalent to about two times uh Indonesia's gross domestic product or GDP for the year 2025. So essentially it's enough money to buy every single thing that Indonesia has produced over the course of the year two times over. So it's it's an incredible amount of money that dedicated purely on just military um activities. uh this amount of money 2.9 trillion again is equivalent to about 2.5% of the world GDP uh and the increase of course that I mentioned this year uh was about 2.9% compared to last year um but this increase I think one might have expected that given the current geopolitical situations that the increase would have been higher um but of course this would have been higher if it was not the case that the largest military spender in the world the US had a decrease um that if the US was not accounted for in the world total, world military spending would have increased by 9.2%.

[00:14:26]So a bit of a sense of you know how big the US plays in uh in these numbers. Um of course world spending um can be seen as highly concentrated in some of the largest military spenders in the world.

[00:14:38]The biggest 15 countries uh account for about 80% of the world's total. And then this of course in effect reflects a concentration of military power also. Um and the the increase that we we recorded this year um most of the biggest spenders in the world apart from the US all increased their spending. What we also saw was that this was also visible across most regions around the world. Uh over 110 countries about 110 countries out of 155 that we have data for also increased their spending in 2025.

[00:15:11]And if divided by geography or geographic regions um spending increases were seen in Europe, in Asia, Oceanania and in Africa while there were uh while Middle East remain unchanged and the Americas uh decreased.

[00:15:25]So kind of with this kind of global um initial global overview, I'll go into the regions uh and hopefully provide you some insight of how the regional dynamics uh impact the the world total.

[00:15:37]So looking at firstly into the Americas where the US is part of um so the Americas as a continent um allocates uh well their spending decreased because the US decreased uh the US accounts for about 90% of the region's spending and in 2025 US allocated about $950 billion so just a bit short of a trillion dollars on its military. uh and this accounts for about 33% of the world total and its spending fell uh by about 7.5% last year in 2025 and the reason behind this is that I think for the first time since uh the war in Ukraine began in 2022 the US allocated no new military aid to Ukraine uh in 2025. So this was essentially why the spending decreased. Uh uh on the other hand um the US itself allocated more resources to its civil uh to its um conventional and milit nuclear uh modernization program with standout programs such as their nuclearpowered Colombia class submarines and also the Virginia class submarines as being one of the major procurement projects that they're funding. Um, but what we see, of course, with the US is that this oneoff, this decrease in 2025 is likely very much a one-off, uh, especially given, you know, the US's current war uh, with Iran, the need that it will have, not only in funding these milit operations, but also as a way to replenish the weapons that it's used. Um, the US Congress has already passed a $1 trillion budget for 2026 and President Trump is seeking to ask for $1.5 trillion for on the military for 2027. So, if all this is passed, then we will likely see uh major hikes in US military spending.

[00:17:30]Um, look and of course impact in the world spending. Uh looking into Europe, um of course the main contributor to the global increase uh within Europe and the world has been of course the war in Ukraine where both Russia and Ukraine continue to uh see increases in their military spending as uh it was just during the fourth year of its war.

[00:17:50]Russia is now the third largest spender in the world behind the US and China and Ukraine is the seventh largest. Um in terms of comparing these two countries, Russia allocates about 190 billion uh US dollars to its military while Ukraine spends about 45% of the U of the Russian number to about 84 billion uh dollars.

[00:18:10]Um apart from you know the increases by Russia and Ukraine driving uh European spending. Um the other main drivers have been the ongoing rearmament efforts seen by European NATO members. um um where we what we've seen is the largest or sharpest increase in year-on-year growth by central and western European countries since the end of the cold war.

[00:18:32]And the level by this group has also been at the highest levels that we've ever recorded. And this includes of course both the materialization of plans announced to rearm following uh Russia's invasion of Ukraine in 2022 but also partly linked to the uncertainty of the US security guarantees for European members of NATO given the kind of turbulent geopolitical situations. Um in 2025 what we saw was that about 22 of the 28 European NATO members spent 2% or more of their GDP on the military while two two countries exceeded the 3.5% um of GDP target.

[00:19:13]Um major increases in Europe um were seen in Germany, Spain, Belgium, Denmark, Norway uh Sweden. Um and many of these countries these increases really uh continue to be linked to major defense procurement and development plans that are either nearing at the end of their cycle that started in 2022 or are part of new cycles um that will extend to about 2030 to 2035. Um a few examples of this is that uh in the case of Germany their spending increased by about 24%.

[00:19:46]And I think many of you would have been aware that a couple of years ago they announced this 100 billion euro special fund of which by 2025 most of that has already been fully allocated. uh in the case of Belgium uh spending increased by 59% and this is part of their star plan which includes major investments in weapons uh and equipment modernization uh including new fighter aircrafts uh upgrades to military infrastructure to meet NATO capability targets. Uh and so many of these um countries in Europe are announcing these increases or have seen these increases very much as part of building up their military capabilities uh um in the coming years to come. Um and of course given this it means that um the region we expect to see continued increases in European spending uh into the late 2020s and maybe even the early 2030s.

[00:20:40]Um in terms of Asian Oceanania, um it's a region that has seen continuous consecutive increasees for over three decades. Uh driven of course primarily by China's military ambition to build up its military capabilities. Uh India kind of seeking to assert itself as both an economic and military player within the region. uh and in some ways more recently the uncertainty again behind a US as a security guarantee to its allies and partners uh in the region such as Australia, Japan, Philippines for example. Uh and so you taking this together it very much builds onto the idea of uh turbulent geopolitics and security dynamics that have led to continued increases in spending in the region. Uh touching a bit on some of the major um countries in the region. So, China of course is the second largest spender in the world and the largest spender in the region and accounts for about half of the regional total uh in terms of military spending. Um the country's military monization program is still very much a long-term uh ambition that will end likely by 2049.

[00:21:46]A and so it's really like the long-term trends um that of China's rising military spending and capabilities has really contributed to essentially the regional security concerns and this is reflected in budgets again in countries like Japan, Taiwan, India, Australia and even the United States where we see that uh as part of the the US's national security strategy, China is still front and center as their kind of main challenger to this global hedgeimon um and very much the case that China's military trajectory has been mentioned in many countries strategic planning reports as one of the reasons why they need to also arm uh or rearm um I think overall perhaps focusing a bit more onto the sub region where uh within Southeast Asia where Indonesia is based um looking at some of the major military spenders um in this sub region such as Singapore, Indonesia and Vietnam um all three of these countries which we saw was major increases in their spending and this is again very much tied to the kind of the increasingly turbulent geopolitical security situation where money has been allocated to accelerating or increasing defense procurement plans. Um submarines, combat aircrafts, armored vehicles, military infrastructure has been all part of essentially uh the the rationale behind uh these increases. Um, in terms of outdata, what we saw is that Indonesia uh allocated about $15 billion dollars to this military in 2025 and this was 30% higher compared to last year.

[00:23:22]Um, looking a bit into the Middle East, um, it was the first year in last 3 years we saw that the spending has roughly remained unchanged. So following two years of increases because of Israel's war in Gaza, um I think the cease that the ceasefire that has had in the early 2025 has led to a drawing down of military operations by Israel and which has also led to of course an immediate impact on Israeli military spending where the the the numbers have essentially come down uh dramatically.

[00:23:52]Um Iran too we saw a decrease mostly because of um severe economic pressure that's placed upon it. And so despite the fact that the country has increased spending uh nominally once we account for uh inflation actually Iran's military spending has um decreased. Uh but of course looking ahead into 2026 and beyond I think our expectation is that spending will likely increase in the in the region not only because Israel and Iran will likely increase their spending given the ongoing war but uh neighboring countries in the region what I've seen will have be incentivized to spend more on the militaries given of course the the issues there but also I think some of the deficiencies that have come about regarding certain air defense systems and the inability for it to defend against is uh Iranian drones and missile So essentially uh we there's expectation that more uh investment will be made to military capabilities in the Middle East uh for years to come. Uh and finally I think stopping with uh Africa uh military spending Africa is by far the smallest of all regions in the world. It only accounts for about 2% of the world total. Um but spending by countries within Africa can be seen as highly volatile uh driven by economic booms and booms and busts linked to commodity prices but also conflict and uh insecurity. For example, I give I'll give two examples in the case that that we saw large increases in spending by Nigeria as it continues to deal with um a wide range of security issues within its territories such as jihadist insurgencies, banditry, kidnapping, farmer herder conflicts. uh and of course uh I think many of you would have known about the the the civil conflict in the Democratic Republic of Congo where spending increased because of uh amid escalating tensions and conflict with the Rwandabacked uh M23 uh group.

[00:25:41]Um so I I'll stop here for now. Thank you.

[00:25:46]>> Thank you Dr. Nantan for your overview.

[00:25:48]Now I'd like to invite Jenny Wanata, project director at Middle Power Studies Network to kickstart our discussion.

[00:25:55]Thank you Anna. Thank you Dr. Nantin for a very comprehensive overview. You gave congratulations for the launch of the report. Um I remember FPCI team has been very patient in waiting for the launch of the report because for the past years the report has been very helpful for our works as well and uh this year we found the findings really interesting. You gave a very comprehensive overview. Um and one of the one of the finding that we find um not not as an anomaly but worth uh exploring is the fact that if we exclude the United States uh in in the equation uh your report said 9.2 2 uh% increase in global military uh spending this year and that if we exclude the United States which is uh correct me if I'm wrong is the first time that we see this uh pressure uh elsewhere uh than the United States uh growing really fast and if we zoom out as well uh indeed this year the report said that it's the slowest annual growth but for the past decade if we zoom out to 10 years trend uh it keeps going up uh now uh compared to 10 years ago 41% increase you you you see in the report and how do you foresee this in the future in the upcoming future um would this then mean uh regardless of Trump um Trump aside should we say uh that next year uh there's high possibility that we will see a a spike uh or in the next couple of years a spike in global military spending all the more.

[00:27:40]>> Yes. No, thank you for the question. I mean, I think you are definitely on to something um that on one hand um the decrease in the US is an anomaly that it is likely only going to happen uh this year in 2025 because of the sudden um zero allocation uh of military assistance to Ukraine. Um whereas before uh I think the US was allocating military aid about 60 50 to 60 billion per year 2025 what we saw was zero and so that's really explains the decrease.

[00:28:15]So but the point is that I think the US itself is continuing to increase their u spending on their own military procurement and modernization plans. So if we take the baseline of 2025 and 2026, we we already see the budget that again the US has planned zero military assistance to Ukraine but they continue to increase more on their own military perspectives taking the 950 billion that US spends and adding to 1 trillion 1.5 trillion then the US will see a big spike >> u the rest of the world will continue to increase I think that's very much clear given the readings uh within Europe uh within you know Asia Oceanania where we see you know China's long-term plans, Japan, Southeast Asia, Australia, India.

[00:29:02]So all of these uh major military spenders um major uh economic powers uh I think you know of course even middle powers have have identified that the current trajectory to security is armament. It is about deterrence. It's about building up its military capabilities in case there's a possible conflict or disagreement. So that's the trajectory which means that taken if you add all this up there's there's no signal that this the the spending increase will slow down. If anything, it will continue to to to speed up. And I think that that the narrative behind this has very much been that there are there will be these threats and these hybrid threats and you know whether it's hypersonic missiles or these emerging technologies means that more money needs to be allocated to developing new technologies to procuring these new technologies and these of course are also increasingly expensive.

[00:30:02]Um so we we don't necessarily see um right now um a path where spending will not increase in the coming years.

[00:30:14]>> Thank you. Uh Nanten, one thing as well you mentioned hybrid threats, right?

[00:30:19]this global military spending numbers.

[00:30:21]Uh, of course when when when CRI did the research and analysis um we have seen new threats uh emerging not only the conventional military tactics of course we now see more uh elements to the threats uh and the risk perception that affects the way they spend the military budgets. Uh we see cyber security threats, disinformation, critical infrastructure risk and so on. Do did the report capture how countries particularly in Europe in this case uh are are recalibrating uh the way they spend their military budgets.

[00:31:04]Um yeah it's it's a it's a very very u topical issue uh I think um because of course uh you know NATO last year announced that essentially members need to spend 3.5% of the GDP on core defense and then 1.5% of GDP of course by 2035 on defense related expenditure and I think this is very much uh part of the pot that you're talking about where it's about you know infrastructure resilience uh sometimes cyber security that is not directly related to the the the defense sector itself but you know very much related to you know um the security like civil security. Uh so far um the definitions that both I think CRI and NATO have used is that this has not been classified at right now. Uh it might change in the future for NATO but CRI for sure has not classified defense related spending and our definition as uh military or defense spending because of course it can be expanded to include various aspects that might not be linked to even when it's core defense capabilities. Um so right now the numbers have not been taken into account but you can imagine that if these more hybrid threats uh cyber are included specifically then the numbers that we see on what we call let's say military spending could be even higher as more dedication politically and resources are being allocated to uh these um categories >> and on the defense position uh of the US and China. Yes, the US is has a decrease in in the military spending, but the decrease we saw is coming from the foreign assistance as you said. Um, so that means the US is not uh pausing their military advancement or or whatsoever, but they're just decreasing this foreign assistance. Meanwhile, China for 31st year now consecutively uh according to the report has increased their military budgets. And it's not about foreign assistance. indeed their military advance advancement agenda and what do you suggest from this uh data uh the trend of where the military power in the world in terms of US China uh standings in the world uh moving forward because one of the data you uh you wrote in in the report as well is the US military spending share globally is decreasing steadily as well um um and and China keep its steady rise so where where are we seeing these military power trends moving forward globally?

[00:33:41]Yeah, I mean for the US of course it's simply a shift in priorities uh right um less priority very much I think because of the Trump administration on Ukraine um more priorities I think towards let's say Israel towards the western hemisphere and continued prioritizing the Indo Pacific region as it sees China as its essentially maj the main kind of uh major power competitor So from that perspective uh looking into let's say the US major weapons procurement programs you can see that it's very much about deterring deterrence and deterring China. So building up its rebuilding its nuclear modernization plan, rebuilding its nuclear capabilities, uh investing in of course uh new classes of uh um aircraft carriers, submarines, uh uh intercontinental ballistic missiles very much in line with what they write in their national security strategy about deterring China because I think they see is that China has slowly be building up its military capabilities. Um now on the other hand um I think China has been very kind of subtle and they have not really mentioned this kind of great power competition in the same way that the the US has. Um and so in the reading is that very much from our perspective that it's very much US-driven uh initiative in terms of countering deterring China. I think that the reading of course again is that seeing Chinese developments uh it's definitely a concern for countries within the region and within the sub region where I think it's more assertive um both let's say coast guard and military kind of actions whether it's to do with you know uh war games or these type of plans have been rather let's say ex can be interpreted as escalatory and a concern for countries in the region regarding territori territories and so as a response again I think the only way that many countries have seen as a way to kind of perhaps rebuff this buildup of military uh assets is to build up its military itself. So you're looking at if you look at like I mentioned like Singapore, Vietnam, I mean these countries have investing heavily into their navy because they see kind of the the actions or the activities that China has been having around let's say the South China Sea. So as a this as a response um but the share I think to your point about whether the the share of US spending as to the world has been decreasing and the the Chinese share has been increasing um I think it's just natural because right now the increase in Chinese spending is faster than the US um and so you know there's been a perhaps a more rebalance but um the US still spends about three times more on its military than China. So purely from a spending perspective and I think more of a capability perspective um there is still essentially no comparison between the two count between the two countries that by far the the US is still should be considered the the global military leader in terms of military capabilities.

[00:36:46]>> And what's your reading on on the Indo-Pacific? We see indeed Australia, Japan and South Korea continue uh to have a rise in their defense budget especially in light of Trump uh presidency. But is is this year a special year with with the higher rate of increase or or what's your reading?

[00:37:09]>> Um I don't think this year is in a way a standout. um spending has been increasing uh for a couple of years now.

[00:37:19]I think perhaps the speed is different depending on whether certain procurement projects have been announced or spend.

[00:37:26]Um but I think we're very much concerned about let's say the trend the direction where things are going and the that the signals is that it is it will continue to increase that procurement plans to build up militaries will continue uh which means of course more essentially more imports for for many countries that don't have a self-sufficient uh military-industrial base that's able to produce all the weapons that it demands.

[00:37:51]I think in the region as a whole the China is the only country that can do that. um air of course invested billions of dollars over the past three four decades to build up its military-industrial base. But for countries like Australia, Japan, you know, Singapore, Indonesia, a lot of this has to be imported. And so again, if you look at let's say who are the main uh suppliers of um these countries, then again it's very much linked to the US. So there's of course there's a very close link between u US foreign policy, US military policy and of course of course the the Trump administration and very much a lot of decisions that these countries have uh and the expectation is that yes more procurement be will be made but a lot of these will come from essentially the US.

[00:38:37]>> Thank you for mentioning that. We know that CRI also looks into the trends uh in in global arms transfer although it's in a different report uh but I think it's important to touch on that as well uh here uh this rise or decline in global military spending that that we discovered in this report how has it correlated with the trends in in uh the emergence of new players in arms supplies? Yes, the US remains as the largest arm supplier globally. But uh which countries are emerging uh as as a player now in in the supplying uh in terms of supplying arms and and in defense industries?

[00:39:15]>> Um I mean I mean I think new players let's say not really new players because these players have been around for decades. Uh for example, let's say South Korea. um if they've invested a lot of money and resources over the years to build up its essentially its capacity to be able to not only build for itself but also export um new players because uh perhaps you can we can term it this way because you know since the since the uh Russia's invasion of Ukraine um Russia as a arms provider has essentially dropped dramatically one because of course they have to supply their own military u but second I think the amount of let's say buyers that are choosing to buy Russian weapons have dropped uh on one hand because I think there's been perhaps a question on the true nature of Russian military capabilities um and so of course that often I mean that often is a signal whether you know whether countries would actually buy weapons from from that country um and so and second um seeing let's say the urgency uh from uh European countries to rearm and the inability for the current European industrial base and even the US to supply the weapons that is needed. Um countries have had to look elsewhere. So you see kind of increases uh as a supplier such as um South Korea I think uh Israel has has been exporter uh Japan these other you know um have kind of become more common as weapon suppliers uh in this case. Um and again I think it comes down to the fact that because of the time that it takes to build many of these weapons uh often countries don't have don't have the time to wait so they buy off the shelf and that could be done through let's say Poland buying a lot of combat aircrafts and armor personnel carriers from South Korea. uh so and the same thing I think let's say with Turkey where I think in the beginning parts of the war we saw that uh drones initially I think Turkey had invested a lot of resources into building drones and the use of drones uh was a major factor in the first year I think first by Ukraine using many uh uh uh Turkish uh drones so that's also been something that I think has come to the forefront >> particularly in Europe with the rise um of of Turkey being one of the suppliers, global suppliers as well. And then we see the spending rise in Europe is the special one is is the most stark one. Do we see any trend in Europe where they're they want to diversify uh suppliers at least intra uh Europe uh or from other countries uh than the US or is it still correlated strongly with the US supplies?

[00:42:10]the I the the I think the transfer of weapons is often very much linked to alliances. So despite Europe European Union trying to ask for pushing for a single market where European countries should buy within the EU from each other uh unfortunately the current um let's say European defense industrial setup is not able to provide the amount of weapons at the speed that's required um to to meet the demand and so um there will be a continued reliance on the US whether uh through this current administration or future administrations that the US industrial base is simply uh so large and able to kind of produce the the quantity of the weapons whether it's ammunition or combat aircrafts at the speed that currently there's no other country in the world that can keep up and so the reliance will remain so and one might question of course there might be other countries that also have large industrial bases is let's say China but you know there's in right now there's no world that any European country would then let's say buy from from China in that way in that manner so you know in a way we think about it is that yeah NATO countries will often buy from NATO countries and within NATO countries the only major producer that can satisfy this demand uh is the US >> thank you now I'd like to open the floor for questions from the participants If you have any questions, feel free to raise your hand with the feature in the zoom or you can also submit your questions in the chat chat box if you wish to send it in written. I see two hands uh raised. We'll start from um Ivan from Ukraine and then Muftar from Indonesia. Please keep your an uh question concise and short so we can accommodate more questions from the rest. Um we'll start from an from Ukraine. I think the operating >> have a nice day. Uh I'm strategic analyst and uh a hybrid warfare specialist from Ukraine.

[00:44:26]Uh one questions if spending continues to rise at this pace uh are there currently any effective international deterance tools capable of preventing uh critical destabilization of global security by the end of this decade.

[00:44:51]>> All right. Thank youan. I think we'll we'll get the list of questions so you can answer it all at once. Nanten, we'll go to Mutar from Indonesia.

[00:45:01]Please keep your question short and concise. You may unmute yourself.

[00:45:05]>> Uh excuse me, Mr. Tantan.

[00:45:09]Uh my name is Ahmed from Indonesia uh at Natan Island. Mr. Dopati Jalal have said that uh middle powers can be game changer in 21 century uh as global rips deepens. So what do you think what is your uh opinion about the insight of Mr. Dinoasi?

[00:45:39]Thank you.

[00:45:40]>> Thank you. We go to Abdul Haleim Salai Adamu.

[00:45:52]Yeah, actually my question is um I don't know if it's possible to um share this uh report with us after the the seminar.

[00:46:03]I don't know if it's possible.

[00:46:05]>> They have it online on on their website actually. You go to CRI website. You just click world military expenditure 2025 and you'll get it right on top of the desktop research.

[00:46:17]>> Okay. Thank you so much.

[00:46:18]>> And we can also send it the link send a link in in the chat box.

[00:46:22]>> Thank you.

[00:46:23]>> Thank you. Thank you. We have someone from India Arun Nagore. Yeah.

[00:46:30]>> Uh hello and uh thank you Miss Venato and Mr. Tien u for the insightful discussion. Uh my name is Arun. I am a graduate student in international relations. Um I just wanted to ask since a lot of the discussion um understandably focuses on the security drivers and uh the kind of strategic necessity but I'm also curious about like the the long-term uh economic side of this trend. So for example, at what point does the uh rising military expenditure begin to let's say meaningfully constrain the regional economic growth for countries like India or uh Indonesia? Like is it possible to modernize our armed forces without entering like a cycle where you know our um uh defense spending gradually kind of crowds out the development priorities.

[00:47:24]This is uh thank you so much Thank you. That's a that's a very good question. Um although it might not be reflected in the report, but I'd love to get your answer on that as well, Anten because I mean in the same uh in the same five years as the defense spending will rise uh in 2020 2030 we will have our uh deadline for SGS and it's falling short. only 17% are on track at the moment and and at the same time the international bodies are facing imminent bankruptcy. Um so that's that's uh two stark trends that we're seeing. Nant you may answer the questions from the audience.

[00:48:04]>> Thank you for these questions. Um I think I I'll start I going orders. So uh I think Ivan from Ukraine, right? Um no it's it's it's a great question because uh you know um I mean I work at a peace research institute so you know we cover trends on armaments because you know that's it's important to understand the global developments but we come from a perspective that of course peace and security should be viewed perhaps through arms control um you know non-poliferation um um dialogue uh instead of deterrence and I think that's very much how we work both within uh where we work with the the UN in terms of their office of disarmament but also with member states in terms of how can we still maintain let's say risk reduction tools given this kind of global escalating nature where does this stand um unfortunately the the the answer I have to give you is that it's not looking good right now um that that the current narrative is that arms control um I mean never talking about disarmament just arms control and risk of deduction is not very much a topic that is of interest by I I'll be trying to be very broad here by let's say um western states um because of the the role that they've seen in terms of the imminent threat of Russia um not only just on Ukraine but of course on essentially NATO and on Europe that there is no room to discuss these issues and right how these issues despite being important are being kind of carried by um emerging countries uh maybe the the global south um last year at the United Nations General Assembly countries such as Mexico, South Africa were the ones to kind of call on the idea of let's understand this rise in military spending as of course some kinds of are there's are justified to increase but what are the risks associated with this rise?

[00:50:09]uh and the risk of getting into essentially an arms race with increasingly um um high capability weapons that can you know kill hundreds of thousands of people if it's misused or misinterpreted um like threat perceptions are misinterpreted. So understanding this types of risk is still very much high on the agenda. Um but unfortunately of course there seems to be right now a kind of a split right now in the world.

[00:50:35]Um and of course you're absolutely right that there are these tools need to exist and they currently currently still exist but less much much less emphasis politically has been put on these. Um hopefully that answers your question. Um in terms of I think uh from Indonesia is it Mr. Mutar? Um, in terms of middle powers and opinions, I mean there's only so much that middle powers can play from a military perspective. If you just look at how big, let's say, um, the big three mil spenders account for in the world, right? The US 33% of the world spending, China 12%, I think Russia 10%. So that together they account for 6%. So from a pure military perspective, um there's no amount of money that middle powers can spend to be able to be on the same equal footing as these countries. So from the perspective of of let's say Europe, it's very much about trying to let's say band together perhaps even if you ban it together, it does not equal to what the US spends. And so there's there will be this continued reliance on you know this alliance dynamics in terms of trying to keep let's say peace and security within certain regions will have to rely on the US or major powers when when I say major military powers I'm talking about USA China and and Russia essentially there's then a major drop off uh after that um but I think we what is made clear of course by many of his major powers middle powers sorry is that they've understood that it is now not a guarantee that the US will come to let's say your assistance with this current administration whether it's in Europe or whether it's in in the Pacific and so as a response to this what we've seen is that they have tried to engage in building up their military capabilities themselves now how successful that would be is not a question because these things take decades um you know being able to build up his military it's not just the money might be spent today but you will not see the improvement in capabilities for 5 10 years time. So but then by that stage perhaps a change in administration might mean a very different dynamic. So I think that's something very much to consider. Um yes I'm happy to Oh yeah thank you for sharing the report uh that the report that uh in the chat and finally thank you uh I think Arun from India uh for this question because indeed it's not covered in this report because right now this report is very much about the trends in in global military spending but it is a major question that I think we need to ask uh as as as a global community whether you are you know prodefense higher defense spending or more on the sides of let's say um arms control deter arms control type of work but what are the consequences to rising military spending and not just from a security perspective but from an economic social perspective um all the research that's been done right now since about the 1970s the general conclusion is that military spending while it contributes to GDP is not the best form to support GDP or economic growth um that when we talk about let's say the the economic multiplier that essentially for let's say for every dollar that's spent on uh on the military uh what do you get out from the economy uh if it's less than one between 0 and one of course means that for every dollar that's spent less is kind of seen in the in the economy. So the military sector from all the research I've done is between zero and one but if you look at let's say more labor intensive sectors such as health education infrastructure we're looking at between 3 to 5. So essentially investing the same money into these you know social sectors will see 3 to five times greater return on let's say the economy than in the military. And of course part of the reason is because the military right now is not very labor intensive. Uh investing let's say um yeah money it's often in the case that it's not actually retained in the country given how let's say countries are dependent on foreign suppliers. So if Indonesia is buying US weapons, of course, a lot of money is being spent, but much of that is going into the US uh defense industrial base.

[00:54:50]Um and of course there's also the question of well what does it mean to crowd out other social expenditure? I mean there's always opportunity cost related um to this. Um and I think one final point I'll touch on is perhaps a question of debt because right now I think the situation is that the world is that the debt levels of the world is about more than 100% of the GDP world GDP which means that debt levels are very high. Um it's very politically unpopular to cut spending uh on social sectors for the military. So one option often what we see whether in Europe or elsewhere is also to take on more debt.

[00:55:25]But of course debt has itself issues being that it can dampen economic growth. We have the questions regarding well how must how does that impact inflation? How does that impact let's say um debt repayment costs? And then of course it's then a cost that's levied to future generations that is you know that we that were repaid by the youth that perhaps are increasingly struggling to find jobs in this current global environment. So there are questions regarding what happens when military spending uh is funded through debt that needs to be considered.

[00:55:59]I'll stop here.

[00:56:01]>> Thank you. Thank you Naten. And I'm glad you mentioned how the emerging countries are now uh uh have the have the not not yet movement but they have more voice in terms of where we're going with this worrying trend. But we saw from last year's report that uh out of the top 10 spenders uh 19 we see we start to see two global south countries if not more uh having their defense budget rise uh quite significant but when we see on the other hand on UN contributors the top 10 spenders they don't change very much uh not one single uh global south countries so I want to ask you for being one that already observed this trend for long time. Do you see global south countries uh moving up top in in in terms of military uh and and defense? Uh uh or are we not you know like it's it's all still the western game and and so on. Uh I mean we see India and and uh South Korea and Saudi Arabia on the top list.

[00:57:12]Uh but what about the rest? Are they are they climbing up to the top uh spenders nowadays? I'm just trying to see whether the global south countries uh are stepping up and and giving their money to defense or are they also having other priorities uh on their attention like economy development at times of ODA is dropping and so on.

[00:57:38]>> Um it's it's it's a it's a yeah it's it's a good question. And I think it's it's um it touches on many uh layers of issues.

[00:57:46]Um I think if you look at the top spenders in the world of course um you know it makes sense that often the major spenders are also the countries with the biggest economies that they have more money to spend on all all other things including the military which is why I think steadily you've seen India become a major military spender because their economy has grown so much over the last two or three decades um and their military spending has kind of kept roughly in line with GDP GDP growth.

[00:58:18]Very much the same with China that China was essentially spending maybe um uh I think a third of what Japan was spending uh in the early 1990s. But as it GDP has essentially grown so much and their military spending has kept in line with GDP growth, it has now become the second largest spender in the world. So the same trend can be seen or can be expected if we see this is the case with countries let's say Brazil um Turkey um that if it is the case that um um their GDP continues to grow at let's say a high pace then they will be emerging as major spenders um but I think on the other hand is that I think looking at their policies there's not been let's say a a substantial shift in let's say political kind of direction or priorities that suddenly these countries are focusing more on defense. Um we see a shift in more let's say the western states but from the global south perspective that's not the case. I think primarily there's still the question I think if if you know uh one's able to attend some let's say um online uh um UN events or even I think the UN general assembly is broadcasted live to you know to the public one can still see that the priority for many of these developing countries is still again like it's it's sustainable development it is providing jobs to the emerging let's say cohort of of of of young people right it's tackling it's tackling unemployment tackling let's say food security, tackling essentially environment. Um these are still very much high on um the agenda. Um so at least right now we don't see shifts in policy. Um but again I mean perhaps ending circling back to the point about the major military spenders is that it is unlike we don't see likelihood that the let's say that the balance of the major spenders will let's say shift towards more global south. we will see a few global south countries emerge as major spenders but um you know we will continue to see let's say like the US will be there right the UK Germany France uh Italy there will still be very much the major military uh spenders in the world >> thank you and we have one more hand raised here aselino lones lonesu sorry if I pronounce your name not incorrectly but um are you here.

[01:00:52]>> Yes. Hello, I'm there. Hi, Jenny. Aes from the Polish Embassy.

[01:00:57]>> Hi. Hi.

[01:00:57]>> Uh, yes. Uh, so thank you. Uh, thank you for the great presentation. Uh, I uh u before I um ask my question, I would like to because I'm not sure that uh it came across clearly enough. So I feel somehow compelled to know that Poland is among uh the NATO members with the highest defense spending uh allocating uh nearly 5% of our GDP to uh defense uh this year it will probably be even more than 5%.

[01:01:31]But uh um going back to Indonesia uh as a Polish embassy in Indonesia, I wanted to to ask uh about military spending and I uh it might be not uh uh your field of expertise to to dive in into the internal politics. But uh uh my question is whether despite the current fiscal pressure uh we should still expect expect defense spending to continue rising and whether external factors also point into that direction. I mean in in Indonesia, >> thank you. Thank you. Anelino Nan, you may answer.

[01:02:11]Uh I must say I'm not familiar with the Indonesian, let's say, um economic uh situation. Um I I can only let's say draw on what I'll draw what I'll draw on is kind of that 2026 is expected to be a difficult year economically for many countries uh around the world, right? A higher fuel cost. I mean the war in Iran is kind of we don't know when it's going to end. Uh the cost of living has gone up. So I mean the IMF recently released a report that they've downgraded essentially GDP growth for like almost all countries around the world. Um but of course on the other hand is that we already see we can already see the budgets that have been passed by almost every country um that has a fiscal year starting January 2026 because the parliament would have to pass the budget at the end of 2025 for 2026. and think the the information that we start to we continue we see um is that yes they agree that there will be an increase that the countries like Indonesia but also others have continued to allocate more to the military um but of course over the course of the year uh governments will also um release revisions to their budgets um and by now end of end of April essentially you know essentially a third of the year has passed uh these revisions have not shown necessarily neessarily that there has been let's say a a shift in that cuts would need to be cuts would be made because of um this uh economic pressure.

[01:03:45]Um I think what we are kind of going by uh by is is that perhaps the shortfall because less revenue will be generated um this year but the spending will still be uh let's say as high as before is that the deficit will be either be covered through the country's country's reserves or through more debt. Um, again, I'm I'm sorry. I don't know what the let's say the economic situation is about in in Indonesia, and I'm not sure what the let's say the debt to GDP ratio is. Um, but I think the the general trend that we can see is that perhaps higher debt will be accumulated um this year.

[01:04:25]>> Thank you. Thank you for the question and and the answer, Nanten. Um, anyone else uh have any questions? We'll we'll close in about five minutes. So we still have five minutes around.

[01:04:38]Ian, are you raising another question or is it just a >> I be very quickly ma'am?

[01:04:44]>> Mhm.

[01:04:45]>> Uh uh my questions is about AI integration.

[01:04:50]>> Mhm. uh for your opinion is this uh what is the share of AI integration and autonomous uh systems in 2026 uh in defense uh budgets? Is this for your opinion a new form of uh digital arms race that is difficult to measure by classical methods? Thank you.

[01:05:15]If I may add to that as well, Nanten, what are these how are we uh uh reading data now nowadays with the changing uh tools that people countries are using in terms of the defense? You know, what items are we looking at today in the 21st century?

[01:05:33]>> Yeah. I I mean the the I must say you know these are often um information that is not readily available across countries. Um there's only a very few select countries that provide the detail in terms of the military budgets that you can see things such as AI or autonomous autonomous weapons. uh for example we don't see this information in the Chinese budget in the Indian budget in majority countries budgets what we do see uh is in the US uh surprisingly I mean they are one of the most transparent countries in the world when it comes to providing information on their defense procurement uh and they have started to allocate uh increasing priority to autonomous weapon systems and AI I think in 2025 five if I'm not mistaken that US allocated about I think it was like $9 billion dollars just to developing you know um AI uh AI within weapon systems not just not not even just autonomous weapons and I think you can see that this is you know as much as some count's entire uh military budget uh so I think the amount for the US is not very big but if we take it into you know compared to the rest of the world some other countries it is massive Um a and I think what what comes from that is that what what you start seeing is the knock on effect of this is that as countries you know ministries of defense have this greater interest in artificial intelligence and AI we start seeing that these comp these types of companies that are traditionally known as ci civilian companies enter the defense space. So before you had this idea that you know there are these typical defense contractors Loheed Martin, Boeing you know Airbus BAE these typical defense contractors that make you know conventional weapons suddenly are now we're seeing let's say like Microsoft um uh you know back then it was you know open AI right uh was open AI like these companies software AI companies are now becoming defense contractors and of course working with ministry of defense on defense products and then I think that becomes blurring of the lines was what is civil, what is military, what is kind of the the the the control behind you know the proliferation of these technologies that are perhaps developed initially for civilian use that suddenly now being used for military purposes. I mean examples uh many would read read the news you know whether they were using I think Claude on you know using AI on you know within the the US uh mission in Venezuela or strikes uh in Iran. So using AI as targeting systems you know that was developed from a civilian perspective and suddenly now being used for the military. So I think there are a lot of questions and risks there that need to be answered and I think the the legislation to kind of prevent less the misuse of AI autonomous weapons has not kept up with the speed of which these technologies are being developed and then being implemented by various militaries around the world.

[01:08:50]>> Great.

[01:08:50]>> I hope that answers your question.

[01:08:53]>> Oh that's a great answer. Thank you Nanten and thank you everyone uh for participating actively uh and for tuning in until the end. Uh I think we will wrap up now. Nanten, thank you very much once again for joining us from Stockholm. It's it's uh morning time there. Um and for those who would like to uh read more and and learn more about the report uh the secretariat of FBCI already send to the chat box the link or you can easily go to the uh your browser uh just type global military expenditure 2025 CRI and you got it immediately. uh and and not just the global military expenditure. I think CBRI has a lot of uh different reports that are useful as well on arms transfer and and any other uh reports as well. So thank you again Nanten. Uh hope to see you again in our next uh discussion hopefully and and for those tuning in uh feel free to revisit our discussion in YouTube channel in secretariat or in Spotify. It will be available as well on our podcast series Eyes on Middle Power. Thank you. Thank you everyone. I'll give the floor back to MC Anna.

[01:10:05]>> Thank you Dr. Tian. Thank you Jenny for this enlightening session. Uh for everyone who's tuning in, today's discussion is available for rewatch on FPCI's official YouTube channel, Secretary at FPCI, and will also be available on our Spotify podcast series, Eyes on Middle Powers. Uh you can follow our social media handles for more information about our activities and programs at Instagram and x fpcindo.

[01:10:31]Thank you again everyone for tuning in.

[01:10:33]See you next time.