Germany's finance chief says new debt essential for defence upgrades
Finance Minister Lars Klingbeil argued that Germany must borrow more to fund its defence and security programmes, citing rising threats.
At a parliamentary session, Finance Minister Lars Klingbeil said Germany cannot maintain its security without taking on additional debt, likening the situation to "flying to the moon without a rocket." He presented a 2027 draft budget that raises defence spending to €109 billion and permits borrowing of €838.2 billion between 2027 and 2030, part of a broader investment surge to €117.5 billion in 2027. The funding aims to address cyber and hybrid threats from nations such as Russia and Iran and to shield the economy from energy shocks linked to the war in Ukraine.
The plan also includes a €500 billion infrastructure fund and looser borrowing rules for defence. While critics invoke Germany’s historical fear of inflation, Klingbeil warned that under-investment would jeopardise future security and economic growth. Recent regional elections saw the far-right AfD gain ground, reviving debates over welfare reforms and social policy within Chancellor Friedrich Merz's coalition.
Why it matters
The financing plan determines how Germany will meet growing security challenges while balancing historic debt aversion.
How this story developed
- Aug 23 Merz warns AfD win in Saxony-Anhalt could scare off foreign investors
- Aug 31 A fact‑checking report found Merz’s asylum and debt figures were inaccurate.
- Aug 31 Chancellor warned that an AfD win could deter foreign investors.
- Sep 1 Ulrich Siegmund, a former perfume seller who left the CDU, has been identified as the AfD’s lead candidate in Saxony‑Anhalt.
- Sep 2 SPD polling in Saxony‑Anhalt falls to about 7‑8%.
- Sep 3 The state parliament passed emergency legislation that raises the thresholds for selecting the minister‑president and appointing judges, limiting the AfD’s ability to govern even if it wins the plurality.
- Sep 4 Election held on Sunday, with results set to decide if the AfD can dominate the Landtag and trigger legal challenges.
- Sep 5 Pro‑democracy rallies were held in Magdeburg and elsewhere as the election approaches.
- Sep 5 The interior ministry has mobilised extra riot police and water‑cannon units and logged over 1,000 rallies and 66 incidents ahead of the vote.
- Sep 6 Polls on election day show the AfD at roughly 41‑43 % and the CDU at about 22‑23 %.
- Sep 6 Early voting started with AfD and CDU candidates casting ballots amid protests.
- Sep 7 The AfD is targeting a vote share above 45 % to seek an outright majority.
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