World military spending drops for first time since 1998

World military expenditures dropped 0.5 percent in 2012, the first time the figure dropped since 1998, according to a report released on Monday by the Stockholm International Peace Research Institute.

World military spending totaled $1.75 trillion in 2012. The drop was driven by major spending cuts in the United States, Western and Central Europe, Japan, Canada and Australia. The decrease was significantly offset by increased spending in Latin America, North Africa, the Middle East, Eastern Europe and Asia.

China grew its military spending by 7.8 percent, an increase of $11.5 billion in spending in 2012. Russia increased its military spending last year by 16 percent, a growth of $12.3 billion in 2012.

Despite the overall decrease, the global military spending total was higher in real terms than it was near the end of the cold war.

"We are seeing what may be the beginning of a shift in the balance of world military spending from the rich Western countries to emerging regions, as austerity policies and the drawdown in Afghanistan reduce spending in the former, while economic growth funds continuing increases elsewhere," Sam Perlo-Freeman, the director of SIPRI's Military Expenditure and Arms Production Program, said. "However, the U.S. and its allies are still responsible for the great majority of world military spending. The NATO members together spent a trillion dollars."

The U.S. reduced its military spending six percent to $682 billion in 2012, which was mostly the result of decreased war spending from $159 billion in FY 2011 to $115 billion in FY 2012. Only $87 billion was requested for war spending in 2013.

The U.S. share of world military spending dropped below 40 percent for the first time since the Soviet Union collapsed.

"All the indications are that world military spending is likely to keep falling for the next two to three years-at least until NATO completes its withdrawal from Afghanistan at the end of 2014," Perlo-Freeman said. "However, spending in emerging regions will probably go on rising, so the world total will probably bottom out after that."