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Germany’s Friedrich Merz plans ‘double bazooka’ for defence and infrastructure

Friedrich Mirz, a consultant in Germany, is considering opening hundreds of billions of additional funding for the country’s military and infrastructure, as the alliance with social democrats speaks.

Two people are familiar with the issue that one of the options subject to review is a proposal from the major German economists to collect up to 800 billion euros in the new public borrowing of separate sons outside the budget over a decade.

A third person who seen early stage negotiations said they focused on a combined package of 500 billion euros. People have warned that other options can be examined.

Such a plan would indicate a change in a traditional conservative approach in Germany for public borrowing. In 2009, Berlin devoted debt brakes in its constitution, limiting government borrowing and maintaining the structural deficit at 0.35 percent of GDP.

Armin Steinbach, a professor of economics at HEC, said, referring to the term used for Olaf Schulles Advisor during the roaming epidemic.

The proposal will motivate a stagnant economy and indicate that the largest democracy in the European Union is serious in increasing the defense capabilities at a time when the American administration seeks to relax the alliance through the Atlantic.

Holgar Schmiding, chief economist in Bernberg, said he could be “very big”. “The negotiations seem to be going very quickly and we can get a quick deal.”

The talks in Germany come at a time when the European Union Committee set on Tuesday a common debt tool that enables member states to finance military equipment.

The tool will include borrowing on the markets against the European Union budget, then lending to member states at cheap prices. Unanimous support from European Union countries will require.

Ursula von der Lin, head of the European Commission, said that loans worth 150 billion euros in loans can buy “air defense and missile, artillery system, missiles and ammunition drones, as well as to address other means of cybersecurity to military mobility.”

She added that raising the financial rules of the European Union for Defense Investments will enable countries to spend 650 billion euros on the defense over a period of four years, or about 1.5 percent of GDP on average.

Countries will also be given the opportunity to redirect regional development financing for defense, and the European Investment Bank will be asked to expand defense investments.

“This is the moment of Europe and we must live it,” said von der Layen.

In Germany, Mirz, which the CDU/CSU bloc won the elections on February 23, accelerated the coalition talks with the Social Democratic Party since then Donald Trump photographed Ukraine President Volodimir Zellinsky. At the White House last week.

On Monday, Mirz said he was aiming at agreement on financing defense with the Social Democratic Party before Thursday, when European Union leaders met to discuss Ukraine’s security and the security of the continent.

He said: “In my view, the urgency is great,” and he refused to comment on the funding proposal. “We must try to agree on this before the European Union summit on Thursday.”

Mirz refused to comment on the tools or numbers, saying: “This is all open.”

Next German advisor It has indicated He wants to use super generations for the outgoing parliament to pass the constitutional amendments that this borrowing will require, because his government may be banned by the extreme right. An alternative to Germany The extreme left dies in the next parliament.

The outgoing parliament can be rebuilt in an extraordinary session until March 25.

Friedrich Mirz speaks in the microphones
Friedrich Mirz said he was aiming at agreement on financing defense with the Social Democratic Party before Thursday, when European Union leaders met to discuss Ukraine’s security. © Michael Kappeler/DPA

Speaking before the exploratory conversations with CDU/CSU, the leaders participating in SPD and negotiators suggested Lars Klingbeil and Saskia Esken on Monday that they would ask for more funding for transport and energy infrastructure, which experts said that they require investment of 600 billion euros.

“Can we even answer big questions now? This definitely includes the issue of external security and defense capabilities in our country. But this also includes the infrastructure, which has been neglected in recent years.” “It has not been much invested in energy, network infrastructure, roads, railways, and collapsed bridges, but also social infrastructure.”

Mirz will also have to persuade the Green Party to secure the majority of two -thirds. He pushed vegetables to fix the wider debt brakes.

The consultant, who made the priests to the result, which led the Socialist Party to the worst result since the beginning of the twentieth century, relaxed the debt brakes. But such a reform will take months and may face severe opposition from some factions in CDU/CSU.

A way to temporarily circumvent the debt brake is to create money outside the budget in the constitution. Schools created a car worth 100 billion euros in 2022 to buy military equipment and weapons after the full invasion of Russia for Ukraine.

More than 80 percent of this box, which ends in 2027, has been committed, but one of the options is to increase it. Steinbach said the package consisting of two -quarter will be a quick “political compromise” to avoid fixing the most complex debt brakes.

The proposal was formulated last week by experts from economic institutes in the country.

The unwanted proposal has been mediated by Jacob von Wizskar, a former economic and political expert, the Justice and Development Party, the Minister of Finance in Sarland. Experts said that the need to quickly increase defense capabilities was a strong argument for the use of debts.

They also approved the reform of the debt brakes during the upcoming legislative body. But politicians need to act quickly and widely, they wrote. One of the people said: “There is no benefit in discussing 100 billion euros or 200 billion euros.”

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2025-03-04 11:23:00

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