Global Defense Spending Hits Record $2.72 Trillion Amid Geopolitical Shifts

Dagens Industri reports that global defense spending has reached a record $2.72 trillion in 2024, marking the eleventh consecutive year of growth and signaling a significant transformation in the defense landscape. This surge is driven by evolving geopolitical dynamics, heightened international tensions, and advancements in military technology, prompting nations to reassess their national security strategies and budgets. In Europe, a renewed focus on defense is evident, largely spurred by the conflict in Ukraine. NATO members are significantly increasing their expenditures, with an anticipated 23 alliance countries meeting the 2% of GDP defense spending target in 2025—a notable increase from just six in 2021. Germany, Poland, and the United Kingdom are spearheading a military buildup described as the most substantial since the Cold War. The United States, the largest global military spender, is shifting its investment towards modernizing its forces and prioritizing next-generation capabilities and research and development (R&D) to enhance efficiency and innovation. This structural shift in defense spending is creating long-term opportunities for investors, positioning the defense sector as a high-growth area with significant innovation potential due to increasing investor demand.