Russia, Latvia, Lithuania and Poland are planning dramatic increases to arms spending, but they remain vulnerable to economic pressures, says thinktank

Russia and its Nato neighbours in the Baltic have agreed dramatic increases in their military budgets, in marked contrast to countries that are further west and away from potential conflict zones, according to a report published by a leading thinktank.

Spending on arms will rise this year by 60% in Russia, by 50% in Lithuania, by nearly 20% in Poland, and by nearly 15% in Latvia, says the Stockholm International Peace Research Institute, Sipri.

Ukraine increased its spending on defence by more than 20% last year and plans to more than double its funding of the armed forces in 2015, it says. Neutral Sweden has agreed to increase its military spending by about 15% over five years. It has also made a unilateral “solidarity declaration” to provide support to any EU member of the Nordic nations that comes under armed attack, the Sipri report notes.

However, the report makes clear that the countries registering the biggest increases have started from a low base and their spending plans, especially Ukraine’s and Russia’s, remain vulnerable to economic pressures.

Though Russia’s spending on arms will rise by 60%, its overall defence budget – including spending on personnel and infrastructure – will increase by 15%, according to Sipri. Most of the increases were planned before the Ukraine crisis and Russia’s economic crisis last year, it says.

“Modernisation of the Russian armed forces has been a major priority since 2011, with the aim of rearming 70% of the armed forces with new equipment by 2020,” says the report. Recent weapons projects include the Su-34 long-range combat aircraft and Verba and S-400 surface-to-air missile systems.

China, Russia and Saudi Arabia have all substantially increased their military spending, though they still fall well behind the US, which remains the world’s largest spender on arms despite a 20% cut in its defence budget since its peak in 2010.



The US defence budget amounted to $610bn (£415bn) last year, compared with China’s estimated $216bn and Russia’s estimated $84.5bn, according to Sipri.

The US accounted for 34% of world military expenditure last year, followed by China (12%), Russia (4.8%) and Saudi Arabia(4.5%).

Total world military expenditure last year amounted to £1.8tn, a slight fall in real terms compared with 2013. Cuts in the US and western Europe were almost matched by increases in Asia, the Middle East, eastern Europe and Africa, where Algeria and Angola registered the biggest increases, financed by oil revenues.

“While total world military spending is almost unchanged, some regions, such as the Middle East and much of Africa, are continuing to see rapid build-ups that are placing an increasingly high burden on many economies,” said Sam Perlo-Freeman, head of Sipri’s military expenditure project.

“These increases partly reflect worsening security situations, but in many cases they are also the product of corruption, vested interests and autocratic governance.”

Unless tensions with Russia escalate significantly, it is unlikely that many Nato countries will meet the target of 2% of GDP on defence spending – including Britain – for the first time since before the second world war.