Material Cost

My country's material cost at the moment is $611B, i only have 145B with a 600b loan, is there a way to lower cost tremendously, I have contracts with my corps on most things I need, but it will not budge from 611B.

Military?

I have 88% military active so not a lot I have a small army

you can lower the quality.
88% active? you could deactivate more.

do you accumulate materials?
do you have more and more that is sitting there unused? this could cost a fortune.
contracts are nice but don't purchase too much.

However if your trying to boost your defense index to meet higher game lvl requirements, you will need to maintain a larger standing army (like from Switzerland size army to Chinese size army)... so pick your poison I guess.

North Korea has the worlds largest military

Pick your priorities.
I would boost my economy first, optimize the corporations and increase income.
then go for a larger army.

No China, largest standing army. N. Korea is up there though..

if you include reserve personnel though....

Well I suppose the gov't in N Korea generally assumes all of their people are potential reserves, considering their military/party first ideology.