How the defence bonanza will reshape the global economy

For the first time in decades, the rich world is embarking on mass rearmament. Wars in Ukraine and the Middle East, the threat of conflict over Taiwan and President Donald Trump’s impulsive approach to alliances have all made bolstering national defence an urgent priority. On June 25th members of NATO agreed to raise their target for military spending to 3.5% of gdp, and allocated an extra 1.5% to security-related items (Spain insisted on a loophole). If they achieve that target in 2035, they will be spending $800bn more every year, in real terms, than they did before Russia invaded Ukraine. The boom goes wider than NATO. By one estimate, embattled Israel splurged more than 8% of its gdp on defence last year. Even doveish Japan plans to stump up.