Germany plans to increase its defense budget to €153 billion by 2029, or 3.5% of its gross domestic product, according to a report by Politico.
The announcement came a day ahead of the NATO summit in The Hague, where member states are expected to debate defense spending targets.
U.S. President Donald Trump has urged allies to raise defense spending to 5% of GDP, including 3.5% for military needs and 1.5% for related infrastructure.
Germany’s defense budget in 2025 is expected to reach €86 billion, equivalent to 2.4% of GDP. The planned increase would bring it to the highest level since German reunification.
To support the boost in spending, Chancellor Friedrich Merz’s government has temporarily suspended the constitutional “debt brake,” allowing for borrowing beyond the standard 1% of GDP cap.
Berlin has also requested that the European Union classify defense-related investments as exceptional expenses under the bloc’s Stability and Growth Pact.
A €100 billion special defense fund, created in 2022 after Russia’s full-scale invasion of Ukraine, is projected to be depleted by 2027.
As a result, a structural increase in the core defense budget is seen as essential to sustain the pace of military modernization.
Chancellor Merz also pledged to invest up to 1.5% of GDP in defense-related infrastructure, such as transport corridors and strategic mobility initiatives, as part of NATO’s broader interpretation of defense capabilities.
The budget also includes expanded commitments to countries affected by violations of international law, with Ukraine as a primary recipient.
In 2025, Germany plans to allocate €8.3 billion in aid to Ukraine — twice the amount proposed under former Chancellor Olaf Scholz. Starting in 2026, this figure is expected to rise to €8.5 billion annually.
The proposed budget is scheduled for approval at a cabinet meeting on June 24. Chancellor Merz is set to address the Bundestag the following day, before departing for the NATO summit.
