Military spending in Asia-Pacific to hit US$533b in 2020: Report – Channel News Asia
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SINGAPORE: Asia is expected to solidify its position as a key driver of global defence spending by 2020, amid brewing geopolitical tensions and as China continues to beef up its military might, a new report suggests.
By the end of the decade, total defence spending in Asia-Pacific is forecast to hit US$533 billion per year, up from US$435 billion in 2015, according to British military publisher IHS Jane’s. The region will likely account for one in every three dollars spent on defence by the early 2020s, compared with one in five in 2010, according to the report, which was released on Feb 21.
Heightened territorial tensions in Asia-Pacific, especially in the South China Sea and Korean peninsula, are behind the “long overdue process of military modernization (moving) up the political agenda in a number of countries”, said IHS Jane’s.
China, which currently accounts for nearly 40 per cent of the region’s total defence spending, is expected to hold on to its title as the region’s biggest spender after expanding its defence budget by 43 per cent from 2010’s US$134 billion to US$191 billion last year.
According to IHS Jane’s, the mainland is likely to continue expanding its budget to US$255 billion by 2020, despite a slowdown in its economy.
Japan and South Korea round up the top three, after having spent US$49 billion and US$35 billion in 2015, respectively.
“While Japan’s largely static budget means South Korea is slowly catching up with Japanese expenditure, China’s apparent commitment to substantial increases annually means Korea will unlikely ever match Chinese budget growth,” Paul Burton, content director for defence Industry and budgets at IHS Aerospace, Defence & Security, said in an email interview.
“This will see China retain its position as the dominant force (in expenditure terms),with Beijing’s budget currently around four times that of Korea’s,” Mr Burton added.
In this study by IHS Jane’s, values are based on constant 2015 US dollars.
In Southeast Asia, the Philippines, Indonesia and Vietnam made it to the top 10 countries with the fastest-growing defence budgets in 2015. “These countries are following China’s lead and we see no sign of this trend coming to an end,” the report said.
Among these countries, Indonesia and the Philippines saw the biggest spending jump of 12.46 and 20 per cent, respectively, from 2014 to 2015.
This latest report is in line with comments from industry players who attended the Singapore Airshow last week. Italian industrial group Finmeccanica and French aerospace, transport and defence company Thales told Channel NewsAsia on the sidelines of the event that regional demand for their security and defence products was growing despite the economic slowdown.
Military spending in Asia-Pacific to hit US$533b in 2020: Report – Channel News Asia}