-- Global spending on defense to increase at a CAGR of 2.25 percent with Asia-Pacific region showing the fastest growth
BOSTON, Oct. 14, 2014 /PRNewswire/ -- Global spending on defense will grow to over $2.1 trillion by 2023 over the 2013 to 2023 ten-year period with the Asia-Pacific region showing the fastest growth. The Strategy Analytics Advanced Defense Systems (ADS) service report, "Opposing Trends in North America and Asia-Pac will Dictate Defense Spending Outlook," predicts that while budgetary challenges remain at the forefront of global defense spending, regional geopolitical factors will translate to increases across all regions.
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- Strategy Analytics' projections for global defense spending are derived from analysing and assessing 84 countries collectively accounting for around 98% of total global defense expenditure.
- Spending in Europe will remain flat as an overall proportion of global expenditure reflecting a mix of priorities. While budgets in Western Europe are expected to remain flat to stable, this will be offset by increased spending by Nordic and Eastern European countries.
- Both the CALA and MEA regions will also see growth, collectively accounting for 16% of global defense spending in 2023.
"North American spending will be dictated by US budgets and the impact of sequestration. We expect supplementary add-ons to US spending to smooth out the overall impact of sequestration reducing the net cuts through 2019 before flattening out and showing a moderate increase over 2022 to 2023," observed Eric Higham, North American Director for ADS. "This will translate to North America spend dropping to just over 31% of global spend in 2023, versus 37% in 2013."
"China will both underpin and spur spending in the Asia-Pacific region, leading to the Asia-Pacific regional spend approaching 30% in 2023, up from 25% in 2013," noted Asif Anwar, Director of the ADS service. "The continued growth in the Chinese military budget will lead to other countries such as Japan, South Korea, Taiwan etc., as well as South Asian countries maintaining strong momentum behind their budgets."
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