Germany Secures €500 Billion Defense Spending Deal

Friedrich Merz, Germany's chancellor-in-waiting, has reached a significant agreement with the Green Party to secure support for a €500 billion ($545 billion) spending package aimed at defense and infrastructure. The deal includes commitments of up to €100 billion for climate protection, in exchange for the Greens' backing of a plan to loosen Germany's strict borrowing limits, enabling increased military spending amid rising security concerns. The package is expected to bolster aid to Ukraine by €3 billion and provide additional resources for federal states. Merz emphasized that the plan would enhance Germany's role in European security, allowing for a major investment in the military to counter Russian threats. Approval of this package is anticipated in the Bundestag soon, marking a significant shift in Germany's fiscal policy. The planned infrastructure investments are projected to stimulate economic growth, potentially increasing GDP by 2% annually over the next decade.