Germany would have to increase its defense spending to five percent of its economic output as demanded by the future US President Donald Trump, an additional financing need of a total of 370 billion euros would arise in the next legislative period. This is the result of a study by the Cologne-based Institute of the German Economy (IW), reported by the “Rheinische Post” (Friday edition).
Already in 2028, an additional 170 billion euros would fall, equivalent to a third of the current federal budget, according to the study. The 2022-established special fund of the German Armed Forces of 100 billion euros, which will be exhausted in 2027, is taken into account in the study.
Since this special fund will only last until 2027, the IW expects a financing gap of 21.5 billion euros in 2028 to even reach the NATO’s two percent goal. If the increase is to 2.5 percent, around 50 billion euros would be missing in 2028 and around 75 billion euros in the period from 2025 to 2028.
“If the NATO target is increased to three percent in four steps from 2025, the financing gap would rise to over 74 billion in 2028 and 136 billion in the entire legislative period” writes IW expert Hubertus Bardt, assuming that this future scenario is the most likely to occur. The party programs would only inadequately provide an answer to how the financing gaps could be closed.