Incoming chancellor Friedrich Merz seeks to shore up defence, infrastructure
Incoming chancellor Friedrich Merz announced an unorthodox plan to recall the old Bundestag parliament later this month. Photograph: Ebrahim Noroozi/PA
It will be asked to set aside debt rules temporarily and back borrowing of at least €900 billion for urgent security and infrastructure spending. ““We know we have to do more,” said Merz at a press conference after reaching agreement with his likely coalition ally, the centre-right Social Democratic Party . “We are both aware that Europe and Germany will have to make huge efforts to increase Europe’s defensive capabilities.
With this “double bazooka”, the Merz-lead CDU hope to square a tricky political circle: meet urgent spending commitments without breaking an election promise to retain Germany’s so-called “debt brake”. The CDU proposals have tested the patience of their would-be coalition allies in the Social Democratic Party , who have been pushing for full-scale reform of the debt brake.
“Our country is running on fumes,” he added, welcoming massive spending in German roads, bridges and railways. The Bundesbank’s proposal suggested an additional debt-financed €220 billion up to 2030, provided that the debt ratio is below 60 per cent, the EU ceiling.
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