Global arms spend hits 1.12 trillion dollar in 2005-report

STOCKHOLM, June 12 (Reuters) US spending in Iraq and Afghanistan is expected to help push global military expenditure further up in 2006 after hitting 1.12 trillion dollar a year earlier, a research body today said.

The Stockholm International Peace Research Institute (SIPRI) said in its latest yearbook that the United States was behind 48 percent of total world arms spending in 2005 and had accounted for most of the year's 3.5 per cent overall gain.

Several states, including Saudi Arabia and Russia, have used a sharp rise in oil prices to boost military spending. The biggest increase worldwide was in the ex-Soviet state of Georgia, which surged by more than 140 per cent to 146 million dollars.

''Looking ahead, increasing trends in world military expenditure show little sign of abating in the near future,'' the Swedish government-funded institute said.

The United States, France and the United Kingdom were all involved in costly overseas operations while China was carrying out a modernisation of its People's Liberation Army.

''In these circumstances, there is a strong likelihood that the current upward trend in world military spending will be sustained in 2006,'' SIPRI added.

Britain, France, Japan and China accounted for 4 to 5 percent each of world arms spending, which overall equalled 2.5 percent of world gross domestic product, or 173 dollar per capita.

RAW MATERIALS FUEL RISES A process of concentration of spending continued in 2005, it added, as 15 countries with the highest spending accounted for 84 per cent of the world total.

The global rise in raw materials' prices helped some countries spend more on weapons, particularly Algeria, Azerbaijan, Russia and Saudi Arabia.

China and India also increased spending, the institute said.

''In absolute terms, their current spending is only a fraction of the USA's. Their increases are largely commensurate with their economic growth,'' it added.

Oil-rich Saudi Arabia boosted its military spending by 4.6 billion dollar in 2005 to 25 billion dollars. This increase meant that the West Asia as a whole showed a rise in defence outlays, which would otherwise have fallen, the institute said.

Arms spending in Iran also rose in 2005 by around 3.9 per cent to 7 billion dollars.

Elsewhere in the world, the institute noted massive arms spending rises in the Caucasus, with Georgia leading the region with 143 per cent. Azerbaijan came next with 51 per cent and Armenia with nearly 23 percent.

The institute said that the official explanation for Georgia's large rise in spending was a wish to join NATO, while others argued that Tbilisi wanted to regain control over the renegade regions of Abkhazia and South Ossetia.

REUTERS SY ND2138