INDUSTRY REPORT
“ According to April 2024 data from SIPRI , total global military expenditure reached US $ 2443 billion ( US $ 2.4 trillion ) in 2023 , an increase of 6.8 per cent in real terms from 2022 .”
Image : Lance Cpl . Ryan Kennelly / USMC .
A U . S . Marine with 3rd Marine Littoral Regiment , 3rd Marine Division , uses an unmanned aircraft system during Marine Air-Ground Task Force Warfighting Exercise 2-23 at Marine Corps Air Ground Combat Centre , Twentynine Palms , California on 23 February 2023 .
INDUSTRY REPORT
SERVE AND PROTECT
We spotlight future spending , growth areas , innovation and technology developments in global defence markets for manufacturers .
The defence market consists of sales of air-based , sea-based and land-based military equipment by entities ( organisations , sole traders and partnerships ) that produce air-based , sea-based and land-based military equipment . This includes support and auxiliary equipment such as radar , satellites , sonars and other auxiliary equipment or maintain , repair and overhaul defence equipment .
Defence markets around the world are affected by geopolitical and security challenges . Increased tensions and conflict have reshaped the global defence-industrial landscape . The combination of Russia ’ s war on Ukraine and rising tensions between China and Western countries have been principal drivers of military spending . This has created a surge in demand for the procurement of new defence equipment , the replacement of legacy systems and increased spending outlay on R & D for next-generation technologies across most key markets globally .
The global defence market is highly concentrated , with large players operating in the market . The top ten competitors in the market made up to 43.71 % of the total market in 2023 . Market concentration can be attributed to high entry barriers and the high costs associated with expansion .
Global defence industry outlook
According to April 2024 SIPRI data , total global military expenditure reached US $ 2443 billion ( US $ 2.4 trillion ) in 2023 , an increase of 6.8 per cent in real terms from 2022 . This was the steepest year-on-year increase since 2009 . The ten largest spenders in 2023 — led by the United States , China and Russia — all increased their military spending . India was the fourth largest military spender globally in 2023 . At US $ 83.6 billion , its expenditure was 4.2 per cent higher than in 2022 . In December last year , analyst MarketsandMarkets ( in its ‘ Global Defence Industry Outlook ’) estimated global military expediture to be US $ 2,012.1 billion ( US $ 2 trillion ) in 2023 and expected it to reach US $ 2,132.0 billion ( US $ 2.1 trillion ) in 2024 , growing at an annual rate of 2.74 % from 2023 to 2024 .
24 | ismr . net | ISMR July / August 2024