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The Military spending space limits the maximum spending to prevent unrealistic spending on weapons. The monthly allowance depends on the country's income, on the financial health of the country and on the size of its population. Weapon orders can be placed as long as the spending space is positive.
If a country does not use the spending space, it will accumulate and will create an even larger spending space in the following months. The accumulation has a limit. The spending space can reach its maximum within several game months.
When weapons are purchased, the spending space declines by the value of that order. Contracts are treated as orders and weapon deliveries that result from contracts or bilateral agreements will also use the same military spending space.
If the value of contracts and bilateral agreements exceed the spending space, it will result in automatic reduction of the contracts to prevent overspending.
In addition, manual orders of weapons can become impossible if the entire spending space allowance is spent in these contracts.