Germany will miss 2% NATO defense spending target: think tank – POLITICO


Germany will not keep its promise to spend 2% of its GDP on its military, a leading economic think tank warned on Monday.

Europe’s biggest economy has pledged to increase spending to meet the target set by NATO after years of neglect, going so far as to create a special fund of 100 billion euros to bolster its military.

Calling the Russian invasion of Ukraine in February a historic turning point, Chancellor Olaf Scholz said in its wake that there was a clear need “to invest much more in the security of our country in order to protect our freedom and our democracy. “.

But the German Economic Institute, a Cologne-based think tank, said Berlin was not on track to hit the 2% mark despite the increase in funding. In a report, the institute notes that no additional cash has been committed for this year. Meanwhile, in 2023, he sees a shortfall of nearly €18 billion despite increased spending.

Public spending will continue to be just below target until 2027. At that point, the special fund will be exhausted and defense spending will fall back to around 1.2% of GDP. If not everything is spent yet, previous years will fall even further short of the target.

The 100 billion euro fund was created to circumvent Germany’s constitutional debt brake. But the Cologne think tank writes that the political commitments – which rule out tax hikes or cuts elsewhere while maintaining debt relief in its current form – remain too restrictive for Germany to meet its commitments in defense spending.




Politico

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