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Accelerated Growth Curve to Push Defense Spending to $2.6 Trillion

by Asif Anwar | Aug 20, 2018

A number of common drivers recurring within and across the different regions will underpin an accelerated global defense budgetary outlay. The Strategy Analytics Advance Defense Systems (ADS) service report, “Global Defense Expenditure Outlook 2017-2027,” forecasts these factors will bolster defense spending, bringing forward previous projections, and translating to a global budget of $2.58 trillion in 2027.


This will also translate to the defense industry sector opportunity continuing its momentum as it is tasked with providing new capabilities, as well as upgrading existing platforms and systems through technology-focused investment. The total available market (TAM) for the defense industry will grow to $827.0 billion by 2027.

Defense Spending Outlook 2017-2027Strategy Analytics’ 2018 global defense analysis is based on an assessment of 95 countries that spent a minimum of $500 million on their annual defense in 2017. Strategy Analytics’ outlook for global defense spending is based on baseline information from SIPRI (Stockholm International Peace Research Institute); information on the SIPRI data can be found at

This is followed by an individual assessment of each of the countries, looking at a range of factors including GDP growth, threat perception and political intent on force modernization and indigenization of the local defense industry covering a ten-year timeframe. Strategy Analytics defense spending outlook forecast is based on a range of factors used to assess global, regional and country-by-country analysis of overall military spending covering procurement (including R&D), services, personnel, infrastructure etc. This in turn provides the basis for forecasting platform, system, subsystem and enabling technology spend that underpins subsequent forecasts.

Spending on radar, EW and communications will be some of the priorities for defense spending along with Command and Control (C2), Computers, EO-IR (electro-optical and infrared) sensors, navigation and smart weapons. While the overall defense spending profile maintains an upwards trajectory, to successfully capture the underlying opportunities at countries operating at differing levels of sophistication and defense spending prioritization, will require the defense industry to understand the tailoring required for partnerships, capabilities and solutions.

Meet Strategy Analytics analysts for one-to-one defense discussions at the Defence, Security and Space (DSS) Forum during European Microwave Week, Electronic Warfare GCC 2018 and at MILCOM 2018 to discuss how the combination of Strategy Analytics’ consulting capabilities, coupled with in-depth defense subject matter expertise, can assist with the industry’s future strategic direction.
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