III.Data shows increased Military investment
Empirical data shows an increasing trend in military investment in many countries. According to information from the Stockholm International Peace Research Institute (SIPRI), the global military expenditure budget in 2020 reached 1,981 billion US dollars, an increase from 2019. Several countries experienced an increase in military budgets in the 2022-2023 period. Finland saw its military budget increase by 36%. Lithuania saw its military budget increase by 27%. Sweden saw its military budget increase by 12%. Poland provides a larger share of the military budget at 11%. Apart from that, Russia experienced an increase in its military budget of 9.2% to 86.4 billion US dollars.
1) Finland
The year 2023 sees a remarkable increase in Finland's military budget, achieving growth of 36% and reaching a total of 6.1 billion euros. This figure marks the highest jump among the countries discussed. This increase was significantly contributed by increases in operational expenditure for the Defense Forces, procurement of defense materials, and support for the activities of national defense organizations. While in 2022, Finland allocated 2.05% of its GDP to defense, the target is to reach 2.52% in 2026.
2) Lithuania
In 2023, Lithuania's military budget increases by 27%, reaching 1.5 billion euros. This increase reflects Lithuania's strong commitment to strengthening its national defense capabilities, especially in the context of the conflict initiated by Russia. The share of Lithuania's GDP allocated to defense in 2022 is 2.15%, with a target set at 2.52% in 2026.
3) Sweden
Sweden's military budget will increase by 12% in 2023, reaching 8.3 billion euros. Although this increase is moderate compared to previous years, it reflects Sweden's determination to increase its defense spending as part of its Total Defense strategy. The strategy aims to increase military spending to reach 2% of GDP by 2026. In 2022, Sweden allocated 1.9% of its GDP to defense, with a target of increasing to 2.52% in 2026.
4) Poland
2023 sees a significant increase of 11% in Poland's military budget, reaching a total of 16.5 billion US dollars. This increase reflects Poland's desire to increase its capabilities and readiness, especially as a potential NATO member. Although in 2019 Poland allocated only 1.8% of its GDP to defense, the plan is to gradually increase this to three percent by 2023.
5) Russia
Russia's military budget shot up by nearly 70%, reaching more than 86 billion US dollars in 2024. This extraordinary increase reflects Russia's huge spending in hybrid warfare against Ukraine and other countries that oppose its interests and ambitions. Even though it was only about one percent of GDP in 2019, Russia plans to keep increasing it indefinitely as long as there is a threat from NATO or other adversaries.
6) Global
Total global military spending increased by 3.7 percent in real terms in 2022, reaching a new record of 2,240 billion US dollars. The value is equivalent in IDR (using the current exchange rate, 1 USD = 15,505 IDR), which is around 34,729.2 trillion IDR.
IV.Forecast for Some Countries
1) United States
The US is projected to increase its defense spending every year until 2033. US defense spending will reach 746 billion US dollars in 2023. This prediction estimates an increase in defense spending to reach 1.1 trillion US dollars in 2033. This consistent increase may be due to various factors such as ongoing military operations, modernization of military hardware, research and development, and personnel costs.The value is equivalent in IDR (using the current exchange rate, 1 USD = 15,505 IDR), which is around 17,055.5 trillion IDR.
2) United Kingdom
The UK Defense Minister stated that military spending will double from current levels to £100 billion by 2030⁴. This increase can be attributed to the UK's commitment to increase its armed forces budget to 3% of GDP. The increase in spending will likely be used to procure new equipment, modernize existing systems, and increase personnel costs. The value is equivalent in IDR (at the current exchange rate, 1 GBP = 19,452.57 IDR), which is around 1,945.26 trillion IDR.
3) China
Projections show that China's military spending is expected to reach 531 billion US dollars by 2030. This rise may be due to China's continuous efforts to modernize its military and assert its influence in the Asia-Pacific region.
