Germany May Fall Short of NATO’s Adjusted Defense Spending Target: Document by Reuters

German Finance Minister Olaf Scholz has expressed doubts regarding the government’s commitment to spending 1.5 percent of its economic output on defense by 2024, a target that has already been scaled back for NATO allies. This information comes from a Finance Ministry document that was revealed recently.

Germany is facing pressure from the United States and other NATO nations to raise its military expenditure to 2 percent of its gross domestic product, adhering to a goal set by NATO members in 2014 and reaffirmed in subsequent years.

The issue of military spending is a significant point of contention within Germany’s ruling coalition. While Chancellor Angela Merkel’s conservative party advocates for a quicker increase in defense budgets, Scholz’s Social Democrats are more cautious, advocating for a steadier approach.

According to the 22-page document, the government’s tax revenues are expected to grow less than anticipated in the coming years due to a weakening economy, thereby limiting options for additional spending. The document states that 7.3 billion euros have been allocated for added defense and development aid until 2022.

However, to approach the already reduced defense target of 1.5 percent of GDP by 2024—an objective set by Merkel last year for NATO allies—significantly higher expenditure would be necessary, a point illustrated in another part of the document.

Defense Minister Ursula von der Leyen, part of the conservative faction, noted during a visit to Latvia that discussions regarding the 2020 budget have just begun. She emphasized that coalition partners have agreed to ramp up military spending to 1.5 percent of GDP.

Von der Leyen indicated that this issue would be part of the budget discussions, which are expected to be finalized by the end of March, stating, “We have time until the end of March. Let us negotiate.”

Military spending is anticipated to increase to 1.3 percent of GDP this year, up from just over 1.2 percent in 2018. Even maintaining spending at the current levels may require reallocating funds from other programs, a process that could prove politically challenging.