German lawmakers on Tuesday approved a massive defence and infrastructure v spending package, put forward by incoming chancellor Friedrich Merz, amid growing concerns over the US stance on the Ukraine war and Europe’s security.
German media have dubbed the plan—a potential trillion-euro investment over the next decade—a “fiscal bazooka” for Europe’s top economy.
According to news agency AFP, he swiftly prepared proposals, marking a significant shift for a nation traditionally cautious about substantial borrowing and military expenditure, received 513 votes in support and 207 in opposition.
Addressing parliament before the ballot, conservative Merz emphasised the necessity to fortify the nation considering Russia’s “war of aggression against Europe”. “It is a war against Europe and not just a war against the territorial integrity of Ukraine,” Merz added.
The CDU/CSU alliance and their prospective coalition partners, the Social Democrats (SPD), intend to exclude defence expenditure from Germany’s rigid debt regulations and establish a 500-billion-euro ($545-billion) infrastructure investment fund spanning 12 years.
The spending programme, alongside domestic investment enhancement, is anticipated to facilitate additional Ukraine support of three billion euros in 2025. European markets showed positive movement and German investor confidence recorded its most significant rise in over two years before the vote, anticipating the expenditure boost.
Merz, encouraged legislators to endorse the measures, particularly given US President Donald Trump’s Russian engagement and Ukraine opposition have unsettled Europe and raised questions about transatlantic alliance stability.
Merz acknowledged US relations as “indispensable” whilst emphasising Europe’s need for enhanced self-reliance in security matters, with Germany assuming a primary role.
The financial boost represents “nothing less than the first major step towards a new European defence community” potentially including non-EU nations such as Britain and Norway, he noted.
SPD’s Defence Minister Boris Pistorius, serving under departing Chancellor Olaf Scholz, supported the substantial spending, stating “we are facing a new era for Europe, for Germany, for NATO, and for future generations”.
He contended that strengthening continental defence would ultimately reinforce the transatlantic partnership “and place it on two legs, namely North America and Europe”.
The conservatives under Merz, victorious in February’s election, negotiated these military enhancement and economic revival plans during preliminary coalition discussions with Scholz’s SPD in early March.
Rather than awaiting the new government’s formation, both parties sought approval from the current parliament. The CDU/CSU and SPD required Green Party support in the existing assembly to achieve the necessary two-thirds majority for debt brake modification.
The Greens initially threatened to withhold support but agreed after a deal was struck last week, with Merz committing 100 billion euros of the infrastructure fund to climate protection. They ultimately backed the proposal after securing this allocation for climate-focused initiatives.
The Alternative for Germany (AfD) and Die Linke, both opposing factions, would have possessed sufficient numbers to prevent the measures in the subsequent Bundestag. Prior to voting, AfD’s Bernd Baumann criticised Merz for attempting to expedite the vote through the existing parliament, disregarding voter preferences.
“The new Bundestag is the legitimate one” because “it has new majorities that the people want”, stated Baumann, suggesting that Merz “wants to buy himself the chancellorship from the SPD and the Greens, like in a banana republic”.
The proposals require approval from the upper house of parliament on Friday, necessitating another two-thirds majority.
Following this, coalition discussions will proceed between the major parties. Merz intends to establish a government by April 20 or shortly thereafter. Pending successful proceedings, the new parliament will vote on his chancellorship appointment on April 23.
