Germany Moves Toward Major Defense and Infrastructure Investment

International International News

Posted by NewAdmin on 2025-03-18 08:52:36 |

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 Germany is preparing for a significant shift in its defense and infrastructure policies under its likely next chancellor, Friedrich Merz. He is seeking parliamentary approval for an extensive investment package that includes increased defense spending and a massive infrastructure fund. The proposal requires a two-thirds majority in the Bundestag, as it involves modifying Germany's strict debt rules.  

The package aims to exempt defense and security spending, including intelligence and aid to Ukraine, from the constitutional debt brake, allowing the country to invest more than 1% of GDP in these areas. Additionally, it proposes a 500 billion-euro fund, financed through borrowing, to modernize Germany’s infrastructure over the next 12 years. At the insistence of the Greens, 100 billion euros from this fund will be allocated to climate-related projects.  

Merz's position marks a shift from his party’s earlier stance against new debt, though recent developments have increased urgency. Germany's military modernization fund of 100 billion euros, created by the outgoing government, is set to run out in 2027. Concerns over the trans-Atlantic alliance, especially following doubts about the Trump administration’s commitment to NATO, have further strengthened calls for higher defense spending.  

The outgoing parliament will vote on the proposal before the new Bundestag convenes on March 25. The package is expected to pass, as the Union, Social Democrats, and Greens together have enough votes. If approved, it will move to the Bundesrat, the upper house representing Germany’s 16 state governments, where another two-thirds majority is required. While initially uncertain, the Bavarian government has signaled its support, increasing the chances of the package’s success.

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