South Korea will increase its military spending by 7 percent in 2018 in response to the growing nuclear and missile threat from North Korea, the Ministry of National Defense (MND) announced on Wednesday.

The defense ministry said the National Assembly had earlier in the day approved a budget of KRW43.2 trillion (USD$39.7 billion) to achieve “competent security and strong defense.”

The increase represents KRW40.4 billion more than that originally proposed by the Moon administration during its budget deliberations.

The military said the increase “reflected the grave security reality of North Korea’s nuclear and missile threats, which have been mounting recently.”