Paul Kirby
European Digital Editor
Reuters
The deal is a personal victory for Germany’s waiting list Friedrich Merz.
German conservative leader Friedrich Merz concluded his huge financial package to revamp defense and infrastructure ahead of the Crunch vote in Parliament next Tuesday.
With the aim of leading the government in the Social Democrats in the coming weeks, Meltz is rushing to push a big boost to spending on defense and sluggish infrastructure.
After winning last month’s election, he said strengthening Europe was his absolute priority as President Donald Trump seemed indifferent to his fate.
After 10 hours of consultation with the Greens, he said the deal sent a clear message to his allies: “Germany is back.”
He added: “Germany is making a great contribution to protecting Europe’s freedom and peace.”
Mertz, which is expected to become Germany’s next prime minister, is bidding to receive debt and spending reforms through the resignation of parliament before newly elected lawmakers can take their seat as moderator on March 25th.
The German (AFD) party’s far-right alternative could double the number of MPS in elections and endanger the push of Mertz’s spending. The party on the left is also opposed to reform.
Under the German constitution, Merz needs a two-thirds majority to pass the changes. With the support of Green and the Social Democrats, he should succeed.
The emergency moves by both the AFD and the left wing failed at the Constitutional Court on Friday to challenge the resignation session of Congress next week, allowing the vote to move forward.
The conservative Christian Democratic leader said the three-party plan agreed by his party, Social Democrats and Green:
Great boost to spending on defense, civil protection and intelligence – more than 1% of GDP (economic output) will be exempt from debt restrictions and will invest an additional 500 million euros (£4200 billion) infrastructure fund for additional investments for over a decade.
The defense program also allows spending on state aid “attacked in violation of international law” to be exempt from the so-called debt forces.
This will allow Prime Minister Olaf Scholz, who is currently on the move, to release 3 billion euros with assistance to Ukraine as early as next week.
Germany’s last government collapsed in late 2024 due to differences of opinion that it had loosened the debt restrictions raised by Chancellor Angela Merkel’s government during the 2009 financial crisis.
That means the government was unable to borrow more than 0.35% of Germany’s total economic output, while the country’s railway and bridge infrastructure squealed from years of lack of investment, and the ministers tried to boost military spending.
Social Democrat Chairman Lars Klingbale said the agreement on Friday sent a “historic signal” to Germany.
The Greens were in the old government, but they are not part of the Mertz coalition. However, the party was pleased that the 10 billion euros set aside for climate funds would go “in the right direction.”
Retiring Greens Foreign Minister Annalena Bearbock also welcomed the defence package, not only making Germany safer, but also “sends clear signals to Ukraine, Europe and the world.”
Germany was responsible for the turbulent times, she added.
AFD co-leader Alice Weidel was not so impressed, accusing Meltz of bent the constitution and putting a “huge burden” on future generations.
“This is nothing more than a financial coup,” she complained.
