IMF Reveals Global Trend: Countries Racing to Increase Defence Spending

JAKARTA - A surge in defence spending is now a strengthening global phenomenon amid rising geopolitical tensions. Countries across various regions are competing to increase their military budgets, marking a shift in fiscal priorities that could have wide-ranging consequences for economies. The International Monetary Fund (IMF) notes that over the past five years, around half of the world’s countries have increased their military budgets. “Defence spending is rising rapidly. In the past five years, around half of the world’s countries have increased their military budgets,” the IMF writes in its April 2026 World Economic Outlook report, quoted on Wednesday (15/4/2026). Not only that, global arms sales have also surged sharply. The IMF records that sales by the world’s 100 largest arms companies have doubled in real terms over the past two decades. One example comes from NATO member countries, which have agreed to raise defence budgets to 5% of GDP by 2035. This figure is more than double the previous target of 2%. This step reflects a major change in the global security landscape, particularly since the increase in conflicts and geopolitical tensions since the mid-2010s. The IMF notes that after a relatively calm period post-Cold War, the number of global conflicts has risen significantly again. This situation is driving many countries to recalibrate their defence spending priorities. The IMF’s analysis of 164 countries since 1946 shows that surges in defence spending are now occurring more frequently, especially in developing countries. In one episode of a surge, defence spending averages an increase of around 2.7% of GDP and lasts for more than two and a half years. “Large surges in defence spending are becoming more frequent, especially in emerging markets and developing countries,” the IMF writes.