Germany plans to increase its defense spending to 3.5% of GDP by 2029, Finance Minister Lars Klingbeil announced on Tuesday as the government presented its medium-term fiscal strategy.
The move comes just ahead of a NATO summit where member states are expected to debate raising the alliance’s collective defense spending benchmark from 2% to 3.5% of GDP, with an additional 1.5% to cover related infrastructure.
“Germany will raise its defense spending step by step so that we will reach a NATO quota of 3.5% in 2029,” Klingbeil said. He added that spending will reach 2.4% of GDP this year, marking another increase from the previous benchmark.
Klingbeil, who also serves as Vice Chancellor, emphasized that the additional funds must be used efficiently, citing the need for more European cooperation in defense procurement, research, and development.
Germany has long faced criticism from NATO partners for failing to meet the 2% target, but the Russian invasion of Ukraine in 2022 marked a turning point. Then-Chancellor Olaf Scholz announced a €100 billion ($115 billion) special fund to modernize the Bundeswehr, allowing Germany to meet the target temporarily.
That fund, however, is expected to be exhausted by 2027, making long-term increases to regular defense spending essential for sustaining NATO commitments.
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