IMF Says Defense Spending Surge Risks Widening Global Deficits
A worker finalizes artillery munitions at a factory in Unterluess, Germany.
Photographer: Morris MacMatzen/Getty ImagesBooms in defense spending pose a risk to economies in the medium term, as these expenditures are mainly financed through higher deficits, according to a report from the International Monetary Fund.
Defense buildups typically boost economic activity in the short term by lifting consumption and investment, but overtime they add to public debt, the IMF said in a report.