Unexpectedly, Singapore— a small island nation and city-state that is the smallest in Southeast Asia in terms of land area—actually has the largest military budget in the region.
This year, Singapore's defense spending increased significantly to S$15.4 billion ($11.5 billion), up 12.7% from S$13.6 billion ($10.1 billion) last year. This is the highest increase since 1998. Projections for the coming fiscal year indicate a continued upward trend, with an estimated budget of S$20.2 billion, an increase of 2.5% compared to fiscal year 2023.
Historically, Singapore has consistently allocated between 3-4% of its annual GDP to defense spending over the past two decades.
But why does this small country need such a large budget for defense?
Strategic Position but Vulnerable
Singapore's strategic yet vulnerable geographic location at the crossroads of global trade routes compels it to place a high value on maritime security. Sandwiched between Malaysia to the north, Indonesia to the south, and China to the far north, Singapore must maintain a cautious and measured defense policy. The goal is to ensure national security without escalating tensions with its larger neighbors.
In the publication titled "Why Did Southeast Asia’s Military Expenditure Increase During a Recession?" by Sugiarto Pramono et al., it is explained that Singapore's dependence on energy imports and natural resources makes the security of supply routes crucial. Increasing military spending becomes a strategic move to enhance defense capabilities, protecting these supply lines and securing national resources.
Moreover, as a host to foreign military bases, including that of the United States, the increase in defense spending also strengthens Singapore's role in maintaining regional stability. This move further strengthens security cooperation with its strategic partners and positions Singapore as a key player in the regional security architecture.
The enhancement of defense capabilities has placed Singapore in a more strategic position within the regional security dynamics. With a strong deterrent force, Singapore gains a solid bargaining position in security negotiations.
Defence Budget: A Strategic Priority
In February, Singapore's Minister for Defense, Ng Eng Hen, stated that he had revised his view of the current global and regional situation. According to him, the risk of regional and global conflict in the coming decade can no longer be taken lightly.
Dr. Ng also emphasized the importance of sustained investment in the Singapore Armed Forces (SAF) to prevent potential aggression against the country.
During the Ministry of Defence's budget debate, he revealed that Singapore will continue to allocate about 3% of its gross domestic product (GDP) to military spending over the next ten years. This budget is intended to maintain the strength and readiness of the SAF, even without considering the possibility of conflict or war.
