Spending on weapons systems in European countries will increase by 14 percent in 2025 compared to the previous year. This put Europe comfortably in the lead in the ongoing global arms race. The significant increase in European arms expenditure can mainly be explained by the large-scale rearmament operation of the European NATO countries in response to the increasing threat from Russia.
Figures on global defense spending are collected annually by the Stockholm International Peace Research Institute (SIPRI). According to the Swedish institute, European countries jointly spent 864 billion dollars (approximately 738 billion euros) on weapons and ammunition last year. 2,887 billion dollars (2,475 billion euros) were spent worldwide. This meant that military expenditure worldwide increased by almost 3 percent. For the eleventh consecutive year, SIPRI saw an increase in expenditure.
This is not only the responsibility of Europe; Countries worldwide are spending more on large-scale armament programs in response to “another year of wars, uncertainty and geopolitical unrest,” says SIPRI researcher Xiao Liang in an explanation of the annual figures. “Given the current crises and many countries’ long-term military spending goals, this growth is likely to continue into 2026 and beyond.”
Most NATO countries above 2 percent
The 29 NATO countries in Europe jointly paid 559 billion dollars (477 billion euros) in military resources last year. Of those countries, 22 were at least 2 percent of their gross domestic product (GDP). In Germany – now the world’s number four when it comes to military spending – costs rose by 24 percent to $114 billion. That corresponds to 2.3 percent of GDP, putting the Germans above 2 percent for the first time since 1990.
Spending by European NATO members rose faster last year than at any time since 1953, according to SIPRI researcher Jade Guiberteau Ricard. According to her, this reflects the “strive for European independence, combined with increasing pressure from the United States to strengthen burden sharing within the alliance.”
Russia’s war against Ukraine led to significant increases in defense budgets in both countries last year, setting new records. Russian military spending increased by 5.9 percent to 190 billion dollars (162 billion euros), about 7.5 percent of GDP. Ukraine increased its spending by 20 percent to $84.1 billion (72 billion euros), or 40 percent of GDP.
According to SIPRI, the military share of government spending in both Russia and Ukraine has been higher than last year. The Swedish institute predicts even higher spending in 2026 if the war continues. Ukraine will be able to increase costs again, partly thanks to the EU loan of 90 billion euros, according to SIPRI.
The Netherlands also spends considerably more
The figures show that smaller European countries are also investing significantly more in defense. The Netherlands remains in nineteenth place in the world, with 28.9 billion dollars (25 billion euros), an increase of 14 percent compared to 2024. These expenditures correspond to 2.2 percent of GDP.
More than half (51 percent) of all arms expenditure in the world is accounted for by the traditional ‘top three’ in this area: the United States, China and Russia. It is striking that US defense spending fell by 7.5 percent last year, to $954 billion. According to SIPRI, this is entirely attributable to the decision of President Donald Trump’s government to no longer provide military support to Ukraine.
Text continues below the graph.
The US increased investments in both nuclear and conventional weapons systems last year, mainly in view of the battle with China for hegemony on the world stage. According to SIPRI, the decline in American military expenditure is short-lived, because Congress has already approved a budget for 2026 of more than 1,000 billion dollars (854 billion euros), while Trump wants to increase expenditure to 1,500 billion dollars in 2027.
Also read
The US pushed massive amounts of advanced weapons into Iran. What if there is a conflict with China?
