Russia threat triggers European military spending hike

Sipri researcher Siemon Wezeman in a statement said that the growth spurt can be attributed, in part, to the perception of Russia posing a greater threat following the country's annexation of Crimea in Ukraine.

"This is despite the fact that Russia’s spending in 2016 was only 27 percent of the combined total of European Nato members," he said.

Latvia registered the biggest increase in military spending ($407 million) with a 44 percent jump from 2015 to 2016, followed by Lithuania at 35 percent ($636 million).

Meanwhile, last year Russia increased its budget by 5.9 percent to $69.2 billion.

Spending increases from 2015 to 2016 were also noted in all but three nations in western Europe - Belgium, and non-Nato countries Ireland and Sweden. Overall military expenditures in this same region rose by 2.6 percent.

Italy registered the biggest defence spending spike in western Europe, with an 11 percent increase between 2015 and 2016. The spike partly reflects Italy's support for its local arms industry.

The US has also seen its first significant growth in military spending in 2016 after five years of decline.

The country increased spending by 1.7 percent to $611 billion last year, which is still 20 percent lower than the peak in 2010.