Defense spending

Beyond the headline of a $1.5 trillion budget request, the U.S. defense sector will be looking for longer-term demand signals in an uncertain fiscal environment before it makes big bets on adding capacity.

Editors delve into the winners and losers in the White House’s $1.5 trillion defense spending plan.

In a $1.5 trillion U.S. defense spending proposal for fiscal 2027 filled with superlatives, arguably no organization made out better than the Defense Autonomous Warfare Group (DAWG).

Spanish Prime Minister Pedro Sánchez has pushed back against President Trump's calls for defense spending increases and canceled a contract with Israel, choosing a different path for the Iberian nation.

In 2024 U.S., Foreign Military Sales reached a new record of $97 billion, more than double the levels seen between 2018 and 2021.

The relationship between the defense budget and GDP is a particularly close one in China, and that link is both strategic and financial.

A larger capital budget for the Indian armed forces mean they may now get the resources they require to get their modernization back on track.

Against the backdrop of rapidly rising global defense expenditure, one trend has gone largely unnoticed: In 2025, the U.S. share of global spending fell to its lowest level for decades.

For Japan, 2026 marks the penultimate year of its five-year Defense Buildup Plan, initiated in 2022 in response to a perceived deterioration in the regional security environment.

Divergent regional trends in global defense spending are a further reminder that this defense market boom is different from those seen in recent decades.

The German parliament has given the green light to a mammoth €50 billion ($59 billion) package of arms deals covering missiles, satellites and more.

Saudi Arabia's defense budget has stagnated, hampered by periods of low oil prices that have precipitated an extended period of fiscal consolidation.

Regional trends are hiding a slowdown in defense spending growth in the majority of countries in the Middle East and North Africa.

Since Kyiv's plan to purchase up to 150 Gripen fighters was announced, a key question has been how the program would be funded.

South Korea has come under concerted pressure from Trump to increase defense spending and to raise contributions toward the U.S. military footprint there.

Poland was the main driver behind Europe’s defense budget growth from 2022-25, but is now running up against fiscal limits of what is sustainable going forward.

U.S. government figures show 2024 was a record year for Foreign Military Sales. The question is how long the European market renaissance which has driven the rise will continue for.

Last week NATO released its official statistics for alliance member defense spending covering the period up to 2025, which made for interesting reading.

Six U.S. allies in the Asia-Pacific region have increased their military spending by a combined 18.9% over the last three years.

Europe's hope of reaching NATO's higher level of defense spending rests disproportionately with France and Germany, but a key potential obstacle is politics.

A slow but steady stream of data has been released on the U.S. FY26 defense budget request, which would represent a substantial hike of 11% in nominal terms.

French President Emmanuel Macron plans for a hike in the country’s defense spending to respond to the growing threat perception.

NATO’s June 2025 summit will no doubt go down as a key point in the alliance’s history. Headlines since the start of the meeting in the Hague firmly suggest that member states agreed to a massive increase in defense related spending with NATO shifting guidelines levels of defense spending from 2% of GDP to 5% by 2035. On paper this would increase European NATO member spending from $476.2 billion in 2024 to well over a trillion dollars by the middle of the next decade based on alliance figures.

Europe is a market transformed in terms of demand, but the task remains of beefing up the local defense industrial base, long accustomed to anaemic orders.

The new UK Strategic Defense Review is clear on threats and what is needed to deal with them, but opaque on how and when these measures will be funded.