Global Defence Spending Soars Amid Geopolitical Tensions

Defence firms are predicting continued growth in military budgets despite political changes in Western countries. Boosted by the Ukraine war and rising tensions with China, global defence spending hit a record $2.4 trillion. Industry leaders remain confident that Western nations will invest heavily in defence to prepare for potential conflicts.

Defence firms are confident that Western governments will continue to increase spending on weapons to counter Russia and China, dismissing concerns that political upheaval in the United States and Europe might curb military budgets.

Global defence spending reached an unprecedented $2.4 trillion last year, propelled by the war in Ukraine and escalating tensions between China and the West, according to the Stockholm International Peace Research Institute (SIPRI). NATO members have agreed to further augment spending at a recent summit in Washington.

Major political shifts in the United Kingdom, United States, and France—top military spenders—have unsettled some investors. However, industry executives at the Farnborough Airshow, a major aerospace and defence gathering, told Reuters that Western governments would continue substantial defence investments, even if aid to Ukraine diminishes. "Ukraine offers a crucial lesson: if you're unprepared, you'll lose," said Lorenzo Mariani, co-general manager of Leonardo, an Italian defence firm.

(With inputs from agencies.)