If one is to look at the top five countries with the highest share of GDP dedicated to defence spending, the list generally tracks with global conflict developments. According to the Stockholm International Peace Research Institute (SIPRI), in 2025, Ukraine topped global rankings at a staggering 40% of GDP while Russia sits at a domestic record of roughly 7.5%. Two of the five big spenders are located in the Middle East; Israel sits at around 7.8% and Saudi Arabia sits at around 6.5%. However, one country in the top five that international media rarely cover, and that most readers, including defence analysts, would be surprised to find there, is Algeria. The country comes in at number two in the world with 8.83% of GDP spent on its military in 2025.
Algeria’s second-place ranking is puzzling at first glance. Everyone else in the top five is involved in a serious conflict that gets significant media attention. Saudi Arabia also differs significantly from the others on the list, but it has utilized its large defence budget to purchase equipment destined to counter Houthi influence in Yemen and to deter any wider Iran-backed aggression in its neighbourhood. But Algeria?
An over 8% defence budget for a country that isn’t involved in an active conflict is strikingly high when compared to nations with far greater immediate threats. In 2025, Iran’s military expenditure as a share of GDP was 2.1%, in the US it stood at 3.2%, in Taiwan 2.1%, and even in neighbouring rival Morocco this was “only” 3.5% all according to SIPRI’s updated database. Algeria has been in its own regional cold war with Morocco since gaining independence from France in 1962. Since the 1960s, Morocco has become increasingly aligned with the West. Morocco was designated a major non-NATO ally by the United States in 2004. In 2020, Morocco became a signatory to the Abraham Accords, recognizing the Israeli state, with the two countries reaching subsequent defence deals. Algeria has done the exact opposite throughout its history. It has maintained a pro-Palestine foreign policy stance, drew close economic and military ties to the USSR during the Cold War, and now purchases defence equipment almost exclusively from Russia and China.
However, Algeria has gained leverage over Western countries. With the onset of the 2010s migration crisis in Europe, Algeria has been a key partner for Mediterranean countries in combating terrorism in their shared region. Most critically, as European countries have scrambled to replace Russian energy since 2022, Algeria has turned into a significant gas and oil provider, especially to southern European nations. As European countries poured more money into Morocco’s economic and defence development, they have grown more dependent on Algeria for counterterrorism and energy security.
In 2026, global geopolitics are shifting and old taboos begin to heat up frozen conflicts. Morocco’s claims over Western Sahara are starting to gain more credibility around the world. Recently, Copenhagen and Athens have formally declared their support for Morocco’s autonomy plan for Western Sahara which pairs economic investment and the return of Sahrawi refugees from the Tindouf camps with Moroccan sovereignty. Simultaneously, Algeria has been seeking to diversify its defence portfolio with more advanced Chinese technology. Algeria has maintained its political alignment with Russia in spite of Western pressure. Recently, Algeria cut ties with the UAE, a country which, just like Morocco, is another partner of Israel and the US. Although one could point back to the earlier security deals made with Italy as evidence that the defence modernization plans are for counterterrorism operations, regional counterterrorism efforts alone do not justify such high defence expenditure. This also brings in the question about what is the real reason behind Algeria’s purchasing of high-tech long range strike capabilities from Russia and China. These are useful weapons for deterrence, but questionable when Algeria faces no substantial external threat. The sharp increase in military spending as a share of GDP (from 4.06% to 8.83% in Algiers’ case) may benefit Algeria in posturing vis-a-vis Morocco. As the US and its allies remain preoccupied with the ongoing war with Iran, and subsequent crises in the Middle East, Algiers might believe it has a chance to position itself more decisively against its neighbor. In doing so, it is set to become one of the first foreign testers of Chinese advanced military tech and its systems integration capacity with Russian equipment.
Should a kinetic conflict arise between Morocco and Algeria, this would be another tremendous headache for Europe. European governments would face a hard choice between Morocco, a diplomatic, security and trading partner, and Algeria, on which they depend for energy and border security. For Italy and Spain, cooperation with Algeria has been crucial in off-setting high energy costs post-Russian invasion and in monitoring excessive migrant inflows. Should Italy and Spain take the more expected pro-Moroccan side, they may face significant cuts in energy and security support from Algeria. This would be extremely untimely for both as Spain faces a new general election in November 2026 and Italy one in 2027. A conflict in the region could exacerbate migrant inflows across Africa and the Mediterranean. Additionally, destabilization in the region may mean conflict spreads to other West African nations. In particular, those that have come increasingly under alignment with Russia.
The increasing potential for conflict across North Africa and the Middle East underlines many things simultaneously. First, the inefficacy of American and Western diplomacy in curtailing conflicts within “their” sphere of influence. Second, the risks Europe succumbs to by outsourcing its energy dependence to either Russia or the MENA region. Third, the contest over what replaces the current order has a long way to run. While we can’t predict the future and so far there’s only one distant precedent of Algeria fighting a war with its neighbour Morocco, sooner or later, Algeria will look for a return on that investment for maintaining such a high defence expenditure for so long.
FURTHER READINGS
1). Mezran and Pavia (2021) “Morocco and Israel are friendlier than ever”.
2). Sour (2024) “The Razor’s Edge: The Western Sahara Conflict as a Geopolitical Antagonism in the Algerian Moroccan Relations”.
3). Profazio (2025) “PIPELINE POLITICS: ALGERIA, ITALY AND THE GREAT GAME IN NORTH AFRICA”.
4). Sour (2026) “Compelled to Hedge: Explaining Algerian Foreign Policy in a Fragmented International Order”.
5). Gouasmia (2025) “China in North Africa”.
6). Semai (2025) “The Russian Presence in Africa and Historical Relations with Algeria”.