Germany requires new debt for defense, says Finance Minister

German Finance Minister Lars Klingbeil has stated that Germany cannot defend itself without taking on new debt. Defending the 2027 budget draft in the lower house of parliament, Klingbeil compared attempting defense without sufficient funding to ‘flying to the moon without a rocket.’

Berlin is increasing defense and security expenditures in response to growing cyber and hybrid threats from nations such as Russia and China, as well as pressure from U.S. President Donald Trump for NATO allies to increase contributions. The government aims to protect its slowing economy from energy shocks related to conflicts in Ukraine and the Middle East, while addressing years of underinvestment.

Germany plans to borrow a total of 838.2 billion euros between 2027 and 2030. While debt aversion remains a significant factor in German national psychology due to the hyperinflation of the 1920s, Klingbeil argued that these investments are necessary to ensure future security and the ability to act. Defense spending is projected to rise to 109 billion euros in 2027, with total security-related expenditures reaching 130.1 billion euros when including support for Ukraine.