Boost in Military Expenses: Germany intends to escalate its defence budget to €170bn by the year 2029, marking a significant twofold rise.
Germany is set to significantly increase its military spending over the next eight years, with the planned expenditure expected to more than double, reaching €170 billion in 2029. This figure, however, contrasts with the forecast made by the Defense Minister, Boris Pistorius, who predicted €152 billion for the same year.
The current military spending in Germany stands at €75 billion. The planned increase aligns with the agreement reached within NATO for annual defense spending of 3.5% of each member country's GDP. However, the German government's planned spending for 2025 does not meet this target, as it is expected to be financed through government loans and amount to more than €120 billion.
Reuters, on the other hand, has forecasted a lower defense spending level for 2025. According to their forecast, Germany's defense spending in 2025 will be €95.1 billion, which corresponds to 2.4% of its GDP. This figure is €56.9 billion lower than the planned spending for that year, as previously mentioned.
The Reuters forecast for 2025 also places Germany's defense spending below the level expected by Defense Minister Boris Pistorius for the same year (€152 billion). It is worth noting that the Reuters forecast for 2025 aligns with the NATO agreement for annual defense spending of 3.5% of the GDP, while the planned spending does not.
The German government is planning to discuss and approve a financial plan next Wednesday, shedding more light on the country's military spending trajectory. More than €120 billion of the planned military spending will be financed through government loans, indicating a substantial financial commitment.
In summary, while the German government is planning to significantly increase its military spending, reaching €170 billion by 2029, the Reuters forecast suggests a lower defense spending level, with defense spending in 2025 estimated at €95.1 billion. The discrepancy between the two forecasts and the planned spending will likely be addressed during the upcoming financial plan discussion.
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