Global military spending on the rise

Figures compiled by the Stockholm International Peace Research Institute (SIPRI) show that government military expenditure globally increased last year, particularly in Europe and the Middle East.  Spending growth was especially fast in Israel and Russia, both involved in ongoing wars, as well as several EU countries.

United States defence spending ($997 billion) accounted for more than a third of military spending globally last year. The European members of NATO accounted for about 18 % and China about 12 % of global military spending. Russia’s share last year was 5.5 %.

Russia’s invasion also compelled Ukraine to become a major military spender. Ukraine’s annual military budget (about $65 billion a year) has put it on par with countries such as France in terms of military expenditure. Ukraine’s military spending is estimated at around 35 % of GDP, excluding the military assistance Ukraine receives (worth roughly $60 billion last year). If the value of military aid to Ukraine is included, Ukraine’s military expenditure would be the fourth highest in the world.

The world’s top ten in military expenditure

Source: SIPRI Military Expenditure Database 2024. The EurNATO spending figure comprises the military spending of NATO’s European members, including Turkey.

Russian war losses and costs continue to mount

SIPRI estimates that Russian defence spending last year totalled about $149 billion (13.8 trillion rubles), a 38 % increase from 2023. Russia’s military spending has more than doubled from its 2021 pre-invasion level. Russian military expenditure last year corresponded to over 7 % of GDP, doubling from around 3.6 % in 2021. In addition to budget allocations to National Defence, SIPRI’s estimates also include shares of other budget categories such as spending on the National Guard and border troops, as well as pensions of the defence administration. Some estimates also include the costs of civilian and military administration in the occupied territories in Ukraine paid out of the federal budget, as well as fortification works in the Kursk and Belograd regions of Russia. Their share of total military spending is small, however.

It has become increasingly difficult in recent years to assess the Russian federal budget, and military spending in particular. Russia no longer releases its actual spending figures, and the share of classified spending has increased. The ultimate use of 30 % of all budget law items this year is concealed by secrecy. Moreover, war-related expenses are covered to a significant extent through regional budgets and off-budget funds. As a result, actual military expenditures very likely exceed SIPRI estimates. Based on the current year’s budget, military spending is expected to increase substantially faster than other federal budget expenditures this year.

While growth in military spending has concentrated on orders for equipment and materiel, manpower-related costs have also increased. Researcher Janis Kluge estimates that military recruitment numbers in the first half of 2025 resulted in about 190,000 new army contracts. Based on Kluge’s estimation methodology, the amount paid from regional budgets for signing bonuses last year reflected recruitments of 155,000 in the first half of 2024 and 220,000 in the second half of 2024.

Russia has not released any official information on its military personnel losses during the war. The lowest base figure could be considered the number from the Mediazona database of confirmed deaths, which shows 117,000 confirmed deaths of military personnel since the start of the war. The number of actual Russian deaths, however, is likely more than double that. Western estimates put Russian losses (killed or wounded) currently at around 1 million. As a comparison, various estimates put total Soviet losses during the 10-year war in Afghanistan at around 50,000 casualties (dead and wounded). Lately, Russia has stopped publishing most population statistics, making it even more difficult to assess Russia’s actual losses from the war.

Since August 2024, the new soldiers signing enlistment contracts have received a one-time signing bonus of 400,000 rubles (4,000 euros) paid from the federal budget and an average of 1.6 million rubles (16,000 euros) payment from local governments. A number of regions pay out significantly larger amounts than the national average. Some regions have reduced the signing bonus payouts in recent months, however, as they deal with large imbalances in regional budgets. In addition to the attraction of the one-time signing bonus, new recruits face a situation where the average wage in Russia is slightly less than 100,000 rubles (1,000 euros) a month. In contrast, a soldier’s average monthly pay, including benefits, is estimated to be around 240,000 rubles a month.

The Re:Russia research group recently estimated that the government spent in the first six months of 2025 about 2 trillion rubles on signing bonuses, military pay and compensation to wounded soldiers and the relatives of deceased soldiers. The amount is about a third larger than the estimated amount spent last year in the same period. The growth reflects both significantly increases in signing bonuses and increased losses on the front lines. If spending continues at a similar level for the rest of this year, the direct costs of military personnel would amount to roughly 2 % of GDP. As noted, only a part of these expenditures appears in the federal budget.

In addition to hefty signing bonuses and the security of a monthly paycheck, a number of other benefits are offered to attract new soldiers. Contract soldiers, for example, may be offered payment relief on their bank loans. While this benefit is seen to lure overstretched individuals into the military, the costs of such arrangements are likely to fall eventually on the banking sector. Soldiers are also offered such benefits as inexpensive housing loans and special treatment of family members seeking admission to schools and universities. Although many extra benefits are not counted as military expenses, they seriously distort economic structures by favouring military sectors at the expense of the rest of society. Such measures can reinforce the role the army and the military-industrial complex far into the future leading to increased militarization of the Russian economy and hampering long-term growth prospects.