economy
April 8, 2026
German military spending pushing deficit higher
Germany’s military spending rose by 23% in 2025, pushing the budget deficit to a multi-year high, according to official data
TL;DR
- Germany's military spending increased by over 23% to €39 billion ($45 billion) last year.
- The budget deficit reached its highest level in four years, totaling €127.3 billion.
- Defense expenditure is projected to exceed €500 billion by 2029 as part of a military buildup.
- The German government aims to have its armed forces 'war-ready' by 2029, citing a perceived Russian threat.
- Russia has dismissed allegations of aggressive plans against NATO members.
- The federal government accounted for €85.4 billion of the total deficit.
- Increased funding for areas like military spending through borrowing contributed to the deficit.
- Germany's economy experienced recession in 2023 and 2024, with near-stagnation in 2025.
- Chancellor Friedrich Merz pledged to make the German armed forces the 'strongest conventional army in Europe.'
- Russian officials warned against Germany's ambition to be a 'main military power in Europe.'
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