Military Expenditures of Different Countries in 2011

The uninterrupted growth in global military expenditures which was observed from 1998 virtually stopped last year. According to the data of the Stockholm International Peace Research Institute (SIPRI, Sweden) published on April 17, in 2011 military expenditures amounted to $1.74 trillion having increased in real terms by the mere 0.3% as compared to the previous year. The average annual growth in global military expenditures amounted to 4.5% in the 2001-2009 period.
Among the countries with the highest military expenditures, six countries - Brazil, the UK, Germany, India, the USA and France - reduced such expenditures, while China and Russia kept increasing them. According to evaluations of SIPRI, in 2011 military expenditures of Russia grew by 9.3% in real terms and amounted to $71.9bn.

In our opinion, evaluations of SIPRI as regards Russia are rather ambiguous.


Firstly, in their evaluations the inflation rate of Russian military expenditures is undervalued - growth in relevant prices was evaluated at about 9%, while in 2011 only the deflator of the GDP as regards the second evaluation of Rosstat grew by 15.8%.

Secondly, as shown in the Gaidar Institute's Annual Review: Russian Economy in 2011. Trends and Prospects, in 2011 Russian military expenditures with purchasing power parity taken into account amounted minimum to Rb 146.3bn. The two-fold difference observed can be explained only by the fact that in its evaluations SIPRI used the exchange rate.


So, as compared to the SIPRI evaluations in 2011 growth in Russia's military expenditures in real terms is sooner lower or does not exist at all, while military expenditures proper in comparative terms are many times higher.


How should it be regarded? There is no need to be either happy or disappointed about it. It is to be remembered that minimum in the past 12 years the high annual growth in Russian military expenditures was virtually reversed by an equally high inflation rate. As long as the state statistics fails to survey and publish indices of military expenditures, the situation is doomed to repeat again: the money has been spent, but nothing good has come out of it.


V.B. Zatsepin, PhD, military science, Head of Economics of the Military-Industrial Sector Department