Germany’s new €100 billion ‘special fund’ for defense spending

Germany has announced a plan to prioritize military spending ‘in light of Russia’s invasion of Ukraine.’

Germany would send 1,000 Panzerfaust 3 antitank weapons and 500 Fliegerfaust 2 antiaircraft Stinger missiles to Ukraine. Germany also said it would finally allow other European countries to immediately send their own supplies of high-tech German-made weapons to Ukraine to aid in defense efforts

Los Angeles Times (see below)

 Finance Minister Christian Lindner wants the Bundeswehr to become one of the most powerful armies in Europe with the planned 100-billion-euro investment. (see full article below)

Minister of Finance about the Bundeswehr

27 February 2022 | MARCUS WEISGERBER | Defense One

The day after Germany said it would send weapons to Ukraine as it battles Russian invaders, Chancellor Olaf Scholz pledged to boost the country’s defense spending, signaling a major shift in defense policy.

Germany will create a €100 billion ($113 billion) “special fund” for its military and up defense spending to 2 percent of its GDP, Scholz told a special session of parliament on Sunday.

“We need aircraft, we need ships, and we need soldiers who are well-equipped…for their missions,” he said. “This can be done for our country as big as we are, as important as we are, in Europe.”

If Germany reaches the 2 percent level, it will become the 11th NATO nation to reach the guideline established in 2014. In 2021, Berlin spent about 1.5 percent of its GDP on defense, according to NATO figues.

“We need to invest considerably more in the security of our country in order to defend our liberty and our democracy,” Scholz said.

The increase in defense spending would mark a major shift in Germany, which for decades has resisted military budget increases.  

Meanwhile, countries across Europe are pledging more weapons and assistance to Ukraine.

“For the first time, the EU will finance the purchase and delivery of weapons and equipment to a country under attack,” European Union President Ursula von der Leyen said. “This is a watershed moment.”

In addition, the 27-nation EU will close its airspace to Russian planes. Norway, the United Kingdom, and Canada also said they would shut down their airspace to Russian planes. The United States has not banned Russian airlines.

The EU has also banned Russian state-owned media and announced new sanctions against Belarus, from whose territory Russian invasion forces have flowed.

Finland, which is not a member of NATO, has sent bulletproof vests and emergency medical equipment to Ukraine, Reuters reports. Helsinki has reportedly allowed Estonia to give Ukraine Soviet-era howitzers previously received from Finland.

Portugal said it would send Ukraine “waistcoats, helmets, night vision goggles, grenades, various ammunition, portable radios and G3 automatic rifles.” 

A senior U.S. defense official, speaking on the condition of anonymity on Sunday morning, would not say how the U.S. and its allies were getting military assistance to the Ukrainians.

“We don’t have any indications that there’s been a blockage or impediment to continued assistance coming from the west to [the] Ukrainian armed forces,” the official said. “That support continues to flow not just in the United States, but from other nations as well… [and] it’s accelerating.”

Also on Sunday, Turkish officials said they would limit the passage of Russian warships through the strait that connects the Black Sea to the Mediterranean, but also that they could not prevent ships from returning to their home ports.

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Germany shakes off post-World War II timidity to back Ukraine defense against Russia

RIK KIRSCHBAUM FEB. 27, 2022 | LA Times

Shocked out of its post-World War II pacifist zeitgeist by Russia’s invasion of Ukraine, Germany was transforming itself with breathtaking speed Sunday to be among the leaders in arming Ukraine with weaponry and boosting its own defense spending.

While more than 100,000 — organizers estimated the crowd at 500,000 — Germans cheered speakers denouncing Russian President Vladimir Putin and his armed forces at a peace rally in the heart of Berlin, Chancellor Olaf Scholz announced stunning plans at the Reichstag less than a mile away to spend an additional 100 billion euros (about $111 billion) for a special fund to re-equip its own military — on top of the 47 billion euros already in this year’s budget.

Increasingly embarrassed by its hesitancy to strongly support Ukraine and break away from its main energy supplier, Russia, the nation with a deep aversion to war following the horrors it inflicted in World War II is now planning to end its historical ban on sending arms into conflict zones.

Scholz said Germany would send 1,000 Panzerfaust 3 antitank weapons and 500 Fliegerfaust 2 antiaircraft Stinger missiles to Ukraine. Germany also said it would finally allow other European countries to immediately send their own supplies of high-tech German-made weapons to Ukraine to aid in defense efforts against Russia.

“The times have changed,” Scholz told a special session of parliament Sunday. “The world is no longer the same. We will have to invest a lot more in our country’s security — to protect our freedom and to protect our democracy.”

With its close business ties to Russia — and dependence on Russia for more than half of its natural gas supplies — Germany had come under increasing criticism from its European Union and NATO partners for dragging its feet on sending arms to help Ukraine defend itself. It had also been reticent in agreeing to tough economic sanctions, such as barring Russian banks from the SWIFT system of international payments.

Scholz, who succeeded Chancellor Angela Merkel just two months ago, finally dropped the refusal to export arms to Ukraine on Saturday — before that, Germany declined to send any supplies other than 5,000 helmets.

Scholz opened the floodgates further Sunday with the surprise announcement that Germany would immediately raise its defense spending to the 2% of gross domestic product (GDP) promised to NATO partners in 2014 from 1.4% currently — after declaring for the last eight years that was not possible.

American presidents past and present, as well as NATO partners, had long pleaded that Germany spend a far larger share of its GDP on defense. Instead, Germany’s underfunded Bundeswehr has been plagued by parts shortages that have grounded most of the fighter jets in its air force and many of its tanks.

“The German government just did a 180-degree turn right before our eyes,” said Thomas Jaeger, a political scientist at Cologne University, in an interview. “It’s remarkable to see the speed of the sea change on defense spending and towards arms exports into conflict zones.”

The chief of the German army acknowledged last week that the Bundeswehr was ill-equipped for a war in Europe that he, like millions of others in Germany, never thought was possible until Russia’s unprovoked strike on its neighbor. “The Bundeswehr is standing there more or less empty-handed,” Lt. Gen. Alfons Mais wrote in comments on social media.

“For the first time since the end of the Cold War, it’s dawning on everyone that the country has an army that probably wouldn’t be able to protect them,” Jaeger said. “It was long so much easier and popular for elected officials to resist spending on defense. That’s all changing fast right now.”

Julius van de Laar, a political analyst in Berlin, said Germany had been under massive pressure from the rest of the EU to take tougher steps against Russia, even though it would mean putting aside its deeply pacifist leanings and the ghosts of its Nazi past.

Germany’s knotty reasoning in thwarting the EU from banning Russia from the SWIFT international banking system last week triggered a strong reaction against Berlin this weekend.

“Germany has been pushed into taking these steps by a surprisingly united EU,” said Van de Laar. “If we’re honest, Germany has been a laggard for decades on defense. And everyone has been telling Germany to stop being dependent on Russian gas. It’s late in the game but at least Germany moved in the right direction.”

At the peace rally in Berlin, most of the speakers and participants expressed relief that Germany was finally jumping over its shadow and strongly contributing to Ukraine’s defense.

“We’re here to show solidarity for Ukraine and we hope we can have a positive effect on ending the war,” said Marc Ahner, a 46-year-old jazz singer holding a sign calling for Putin to be jailed for war crimes. “I don’t think Putin will be intimidated by us. But it’s still important that we’re all here standing up for Ukraine and hopefully he’ll see all that support.”

Ahner added that, like many Germans, he was torn apart by the question of whether Germany, which was responsible for so much death and destruction during World War II, should be involved in sending weapons.

“It’s a horrible bind for us to be in,” he said. “I really don’t know what is worse — to be accused of not helping Ukraine by not sending weapons or to be sending weapons into a war zone. But it’s probably the lesser of two evils.”

Hartmut Kramer, a pensioner in Berlin who was born in 1944, near the end of World War II, said he has been taking part in peace marches for decades and opposed the stationing of U.S. nuclear weapons in West Germany during the Cold War. But he said Germany has no choice now.

“I’m always against weapons,” said Kramer, who as a 1-year-old in Upper Silesia, now part of Poland, was among those fleeing an invading Russian army. “I’ve always believed in the peace movement. But nothing justifies what Putin is doing. It’s with a heavy heart that I would say sometimes there’s no other choice but to send weapons.”

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LINDNER WANTS “ONE OF THE MOST POWERFUL ARMIES IN EUROPE”

02/28/2022 10:28

Berlin (dpa) – Finance Minister Christian Lindner wants the Bundeswehr to become one of the most powerful armies in Europe with the planned billion-euro investment.

“Our goal, my goal too, is that we will have one of the most effective, effective armies in Europe over the course of this decade. One of the best-equipped armies in Europe, because that corresponds to the importance of Germany, our responsibility in Europe,” said the FDP leader in the ARD “Morgenmagazin”.

A special fund is to be made available with new debts of 100 billion euros. The Basic Law should ensure that the Bundeswehr pot cannot be modified or used differently by changing parliamentary majorities, said Lindner.

Paris praised the Berlin decision: “It’s a gigantic leap that Germany is making under the pressure of events,” said France’s Secretary of State for Europe, Clément Beaune, on the Europe 1 broadcaster. The Federal Republic is increasing – together with others – the security of the continent. Especially in crises, Europe leads the way, s Beaune.

Left: “No new arms race”

Linke boss Janine Wissler, on the other hand, sharply criticized the planned massive increase in defense spending in Germany. “There must be no new arms race,” said Wissler on Deutschlandfunk. The Bundeswehr has been massively upgraded in recent years. Disarmament treaties are needed again as soon as possible.

A better-equipped Bundeswehr in Ukraine would not have made any difference at the moment, said Wissler. “The situation now is dramatic, but we also have to think about tomorrow and the day after tomorrow.”

Lindner wants to comply with the debt brake again from 2023

In the normal budget, Finance Minister Lindner wants to comply with the debt brake again from 2023, despite a special fund worth billions for defense. He emphasized that it was all the more necessary to deal with every euro carefully there and to think carefully about what was affordable.

“We will have to prioritize all public spending over the next few years.” However, this does not happen because of the strengthening of the Bundeswehr, but is necessary anyway. This year, Lindner wants to take on another 99.7 billion euros in new debt because of the Corona crisis.© dpa-infocom, dpa:220228-99-318301/4

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Germany Boosts Defense Spending In Response To Russia’s War On Ukraine

28 February 2022 | Alexandra Brzozowski and Oliver Noyan  | EurasiaReview

(EurActiv) — Germany will establish a special defence fund worth €100 billion to increase the country’s military’s operational capabilities after years of neglect, Chancellor Olaf Scholz announced on Sunday (27 February), in what could be seen as a major shift in Berlin’s defence spending.

This new announcement comes after Saturday’s historic shift by Germany on arms deliveries to Ukraine, which Scholz explained as: “in response to [Russian President Vladimir] Putin’s aggression, there could have been no other choice.”

“We will from now on, year for year, invest more than 2% of our gross domestic product in our defence,” Scholz told German lawmakers at an emergency session of the German Bundestag on Sunday morning.

He justified the move by referring to the attempt by the Kremlin to establish a ‘Russian Empire’, with Moscow using military force to reshape the international system, he told the Bundestag.

Berlin has long resisted pressure from the United States, notably under former US President Donald Trump, to raise its defence spending to 2% of its economic output in the light of its history.

According to NATO statistics, Germany is expected to have spent 1.53% of its GDP on defence in 2021.

The current German coalition government had previously been reluctant to commit to the target, despite pleas from NATO allies.

Now, Scholz announced the government had decided to earmark €100 billion for military investments from its 2022 budget. For comparison, Germany’s entire defence budget in 2021 was €47 billion.

He also called on all the parties in the Bundestag to “secure this special fund in our constitution”.

“We must invest significantly more in the security of our country in order to protect our freedom and our democracy in this way,” Scholz emphasised, adding that Germany needs a “powerful, state-of-the-art, advanced German Bundeswehr that reliably protects us.”

The move comes as high-ranking German military officials have warned of the disastrous condition of the country’s armed forces, which have suffered financial and equipment shortages for years.

“The Bundeswehr, the army I am allowed to lead, is more or less bare. The options we can offer the politicians to support the [NATO] alliance are extremely limited,” Alfons Mais, the 21st Inspector of the Army and commander of the troops, said on LinkedIn on Thursday.

In reference to the current state of the German Bundeswehr, Scholz said: “We need planes that fly, ships that sail, and soldiers who are optimally equipped for their missions.”

Germany could for example purchase US F-35 fighter jets built by Lockheed Martin to replace its ageing Tornado in the role of nuclear sharing, Scholz said.

At the same time, the chancellor emphasised that these military investments will be taken in close collaboration with France and other EU member states and that the next generation of European fighter jets and tanks should be developed jointly.

“These projects are of the highest importance for us,” he stressed.

The EU’s future Strategic Compass, the bloc’s upcoming military strategy document to be approved by EU leaders in March, seen by EURACTIV last year, includes a series of ideas for European capability development and funding.

Germany commits €100 billion to defense spending

27 February 2022 | DW

Germany has announced a plan to prioritize military spending in light of Russia’s invasion of Ukraine. A “special fund” will be set up to better equip the Bundeswehr.

German Chancellor Olaf Scholz announced a plan to beef up the German military on Sunday, pledging €100 billion ($112.7 billion) of the 2022 budget for the armed forces and repeating his promise to reach the 2% of gross domestic product spending on defense in line with NATO demands.

Scholz announced the new allocation in a speech during a special session of parliament on Germany’s response to Russia’s invasion of Ukraine. He said the spending would include investments and armaments projects for the German military. 

Scholz also said Germany would supply the Ukrainian military with weaponry, in a reversal of previous policy.

“We need to support Ukraine in its hour of desperate need,” the chancellor said. 

“In attacking Ukraine, [Russian President Vladimir] Putin does not just want to eradicate a country from the world map, he is destroying the European security structure,” Scholz told German lawmakers.

Why is the defense boost important?

“It’s clear we need to invest significantly more in the security of our country in order to protect our freedom and our democracy,” Scholz said. 

Germany reported a record high in NATO defense spending for 2021, submitting a budget of €53 billion for the current year.

That figure marks a 3.2% increase over the year before. In 2020, spending was capped at an estimated €51.4 billion.

The €100 billion Scholz said would be dedicated for the armed forces this year is a one year boost though the move is significant, as Germany has often been criticized by the United States and other NATO allies for not investing enough in defense. 

“We are not alone in defending peace,” Scholz said, adding Germany would be deploying more forces to NATO’s eastern flank.

Former German defense leaders have been publicly circumspect about the country’s lack of military readiness since Putin gave a speech last Monday announcing his intentions and motivations for invading Ukraine.

The decision to step up and meet NATO’s target for defense spending of 2% of GDP came as  bitter medicine to some lawmakers , who could be heard reacted negatively to the chancellor’s announcement during the Bundestag address.