defense budget

A Boost in German Military Spending

jet-falk bärwald-dpa
Many Bundeswehr fighter jets are grounded for repair.
  • Why it matters

    Why it matters

    Germany’s military, long underfunded compared to many of its European neighbors, hopes to get a significant spending upgrade over the coming years to upgrade its hardware.

  • Facts

    Facts

    • Germany currently spends about €35 billion a year on the Bundeswehr, less than the 2 percent of GDP recommended by members in the North Atlantic Treaty Organization.
    • The €130-billion increase requested would amount to €8.7 billion a year, or 25 percent based on 2016 spending levels.
    • The number of soldiers in the German forces has declined in recent years to 168,277 in 2015 from 188,500 in 2005.
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    Audio

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With Germany’s federal budget overflowing, and the finance ministry thinking about ways to spend the spoils, Germany’s defense minister is hoping to get a major piece of the pie.

Ursula von der Leyen has asked a Bundestag parliamentary committee to approve an extra €130 billion ($140 billion) in military spending over 15 years to modernize the nation’s battle readiness and boost staffing.

Ms. von der Leyen said Germany’s military is underfunded and lacks the ability to participate in international operations and NATO missions. The country currently spends about €35 billion a year on the Bundeswehr, less than the 2 percent of GDP that the trans-Atlantic NATO alliance wants its members to spend annually.

The increase requested by Ms. von der Leyen, if approved, would amount to roughly €8.7 billion a year in additional military spending. It marks a boost, based on 2016 spending levels, of about 25 percent.

“If we look at the missions that the armed forces have, then they also need appropriate equipment,” Ms. von der Leyen told reporters on Wednesday.

She’s hardly the only German minister looking to get more funding. The country will need to spend tens of billions to deal with an influx of more than 1 million refugees into Germany last year. Economy Minister Sigmar Gabriel, who also heads the center-left Social Democratic Party, this week presented his own proposal for a €600-billion increase in infrastructure spending over the next decade.

“I think that we can take a substantial increase of investment in military hardware in the coming years for granted.”

Thomas Paulsen, Körber Foundation

Still, experts think Ms. Von der Leyen has a good chance of getting additional funding, even if Finance Minister Wolfgang Schäuble has said he remains determined to balance the books over the coming years.

“Mr. Schäuble would like to hang on to a balanced budget. So we will see if Ms. von der Leyen will be successful with her request,” Thomas Paulsen, a member of the executive board at the non-profit Körber Foundation, told Handelsblatt Global Edition. “But in the end I think that we can take for granted that there will be a substantial increase of investment in military hardware in the coming years.”

Ms. von der Leyen argued that additional resources were needed both to protect from domestic threats, like terrorism, and to fund Germany’s increasing role in foreign missions.

“With the changing security situation, we have two big tasks: The state and federal defense, which will grow in importance. And the second one is the necessary missions that need equipment on an equally high level,” she said.

For the last decade, Germany has if anything cut back on its military. The number of soldiers has declined in recent years to 168,277 in 2015, from 188,500 in 2005. There are currently 3,002 German soldiers on foreign assignment.

New investments are necessary to upgrade much of the country’s military hardware, experts said.

“The military forces are tired,” said Hans-Peter Bartels, a parliamentary commissioner responsible for the German armed forces, after the committee meeting. “There are too many things missing. Training and exercises cannot take place because we lend vehicles, arms and night vision goggles to other associations. Our motivation is suffering.”

Germany has 93 Tornado military fighter jets, but only 40 are operational, Mr. Bartels said. Only five of 40 military transport helicopters are operational, as are only four of 22 Sea Lynx helicopters used by the German Navy.

 

Ursula von der Leyen on jan 27_Michael Kappeler_dpa
Ursula von der Leyenspoke to reporters Wednesday about why she thinks investment of €130 billion in Germany’s armed forces is necessary. Source: DPA/Michael Kappeler

 

Europe’s largest economy generated a budget surplus of €12.1 billion in 2015, according to the federal statistical office. Last month, German Chancellor Angela Merkel told a Bundestag committee that Germany needed to spend more on its military in light of increasing terrorism and other instability in Europe.

German government ministries and their leaders are jockeying to get a portion of the additional tax revenue.

Economics Minister Sigmar Gabriel on Tuesday said Germany should spend €600 billion on infrastructure, research, education and other measures through 2025. He heads the Social Democrats, the junior partner in Ms. Merkel’s political coalition and is her likely political challenger in 2017.

Nevertheless, Ms. von der Leyen remains optimistic.

“I believe it is not out of the question. I will now go into detailed negotiations about our budget. I am optimistic,” Ms. von der Leyen told reporters.

The German public has in the past been wary of the country taking a bigger role in foreign military engagements. But Mr. Paulsen of the Körber Foundation said he doesn’t expect this will provoke a lot of backlash over the plans for higher military spending. Such financial discussions have less of an impact on people’s daily lives, he argued.

“I don’t think that people in Germany will go on the street to protest these investments. Defense spending is not something that the average person is too much involved in,” Mr. Paulsen said.

 

Franziska Scheven is an editor with Handelsblatt Global Edition. To contact the author: scheven@handelsblatt.com

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