Asia’s Defense Spending Soars Amid Economic Slowdown
Japan plans to double military spending by raising defense spending to 2% of GDP by 2027, and Taiwan has proposed its largest-ever defense budget for 2024.
Iruma Base Commander Assistant Air Chief Amio Sato (C) is seen during the military salute to members of Japan defenses force at the end of a ceremony during Prime Minister Kishida’s Air Self-Defense Force Review at Air Self Defense Force (ASDF) Camp Iruma in Saitama prefecture, Japan, Tokyo on November 11, 2023. Photo by Anadolu Images.
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n a surprising turn of events, Asia’s defense spending reached an unprecedented $510 billion in 2023, raising concerns about the sustainability of such ambitious budgets amidst a potential economic slowdown. The region experienced a nominal 2.8% increase in defense expenditure from the previous year, with a real increase of 4.6%.
This surge is primarily attributed to China’s continuous military modernization and North Korea’s escalating belligerence, heightening tensions across the continent.
China, marking its 29th consecutive year of increased defense expenditure, announced a budget of RMB 1.55 trillion (USD 219.5 billion) in March 2023, reflecting a substantial 7.2% nominal increase. The military giant accounted for 43% of regional defense spending in 2023, causing unease among neighboring states.
Beijing’s assertive behavior in the South China Sea, establishment of overseas military bases, and increased aggression have triggered concerns about its military intentions, particularly in the context of Taiwan.
Increasing defense budgets
In response to China’s militarization, neighboring countries have escalated their defense budgets. Taiwan proposed its largest-ever defense budget of TWD 606.8 billion (USD 19.1 billion) for 2024, focusing on enhancing its defense industrial capacity and acquiring advanced weaponry.
Other major players like Australia, Japan, and South Korea are positioning themselves for long-term security by investing in cutting-edge capabilities.
Australia, under the AUKUS partnership, is not only investing in nuclear-powered submarines but also advancing technologies such as artificial intelligence, hypersonic missiles, and quantum technologies.
Japan, facing its most severe security environment since 1945, has plans to double military expenditure by raising defense and related security spending to 2% of GDP by 2027. South Korea, countering North Korean threats, has allocated KRW 348.7 trillion (USD 266.07 billion) for its 2024-2028 mid-term spending plan, emphasizing reconnaissance satellites, submarines, advanced missile interceptors, and electromagnetic pulse weapons.
Increasing defense budgets
In response to China’s militarization, neighboring countries have escalated their defense budgets. Taiwan proposed its largest-ever defense budget of TWD 606.8 billion (USD 19.1 billion) for 2024, focusing on enhancing its defense industrial capacity and acquiring advanced weaponry.
Other major players like Australia, Japan, and South Korea are positioning themselves for long-term security by investing in cutting-edge capabilities.
Australia, under the AUKUS partnership, is not only investing in nuclear-powered submarines but also advancing technologies such as artificial intelligence, hypersonic missiles, and quantum technologies.
Japan, facing its most severe security environment since 1945, has plans to double military expenditure by raising defense and related security spending to 2% of GDP by 2027. South Korea, countering North Korean threats, has allocated KRW 348.7 trillion (USD 266.07 billion) for its 2024-2028 mid-term spending plan, emphasizing reconnaissance satellites, submarines, advanced missile interceptors, and electromagnetic pulse weapons.
India is less interesting in in increasing defense budget
However, not every country is following this trend. India, for instance, increased its defense spending by only 1.5% in 2023, a reduction in real terms considering the inflation rate. This discrepancy raises concerns about the affordability and sustainability of such ambitious defense plans.
The economic backdrop adds another layer of uncertainty, with advanced Asian economies projected to grow by a modest 1.7% in 2024. Questions arise regarding the financial feasibility of these defense budgets, particularly for nations like Japan with a large national debt and Australia facing significant costs associated with AUKUS-related expenditures. The reality of maintaining these budgets becomes even more challenging as the economic momentum in the region shows signs of slowing down.
As tensions rise and defense spending grows faster than economic growth, the Asian region faces a crucial juncture where financial realities may collide with security ambitions. The prospect of a return of former U.S. President Donald Trump, with his isolationist tendencies, adds another layer of uncertainty, potentially impacting the geopolitics of the region.
Observers are closely watching how Asian nations navigate these challenges to ensure the security and stability of the continent.
Source: IISS
