Berlin is rearranging its priorities. Chancellor Friedrich Merz plans to lift defence spending to 3.5 per cent of GDP by 2029, having hit the earlier NATO target of two per cent only in 2024. In the 2027 draft budget, 20 percent of total spending, €109.7 billion out of €555.4 billion, is earmarked for defence. Core defence spending rises from €82.2 billion in 2026 to €109 billion in 2027.
The threat behind the spending. German intelligence (BND) warns that Russia may start a large-scale conflict with NATO by the end of the decade. Moscow plans 17.1 trillion roubles (about $202.6 billion) in defence spending for 2027, the highest since the 2022 invasion.
NATO members have agreed to work toward 5% of GDP in combined defence and security spending by 2035. Moscow rejects this reading. Russian Foreign Ministry spokeswoman Maria Zakharova accuses Berlin of an openly hostile policy towards Russia.
How Germany pays for it. The 2025 constitutional reform exempts all defence spending above 1 per cent of GDP from the debt brake. Berlin will commit €783.8 billion to defence-related expenditure between 2026 and 2030. Finance Minister Lars Klingbeil argues that decades of underinvestment cannot be fixed with a balanced-budget policy.
The belt-tightening at home. The draft plan raises taxes on alcohol, cuts social benefits and reduces pension subsidies. Critics say debt is no obstacle for defence but is treated as a problem in health.
The wider cost abroad. Development aid is also being squeezed. The development ministry's budget falls from €10.05 billion to €9.469 billion in 2027, the fifth consecutive cut since 2023. Aid groups say humanitarian funding has been halved compared to 2024 and estimate the funding gaps could mean 9.4 to 22.6 million preventable deaths by 2030. That is an NGO projection, not an official figure.
International climate finance drops to €5.3 billion, below the €6 billion pledge, which hits African countries on the front line of climate change. Germany still funds Ukraine, with €11.6 billion earmarked for 2027.
What it means for Africa (my analysis). Europe is moving from soft to hard power: less aid, more arms. African governments may find Berlin more focused on its own security and Ukraine, and less on development partnerships in the Sahel and West Africa. That is a gap other powers, including Russia and Türkiye, are positioned to fill.
Mustapha Bature Sallama
Medical/Science communicator, Private Investigator, Criminal Investigation and Intelligence Analysis,United States Institute of Peace (USIP), [email protected] +233555275880
References
Reuters via Investing.com: https://www.investing.com/news/economic-indicators/german-cabinet-approves-2027-draft-budget-hikes-defence-investment-spending-4777033
Il Sole 24 Ore: https://en.ilsole24ore.com/art/berlin-military-spending-110-billion-33-per-cent-we-cannot-defend-ourselves-putin-a-balanced-budget-AJrfnp
ARA: https://en.ara.cat/international/cuts-to-the-welfare-state-to-invest-more-in-defense-merz-presents-the-2027-budgets_1_5722623.html
The Local: https://www.thelocal.de/20260707/germany-cuts-development-aid-for-the-fifth-time-since-2023
Terre des Hommes: https://www.tdh.de/en/protest-in-front-of-the-chancellery-alliance-warns-of-consequences-of-planned-cuts-in-development-and-humanitarian-aid
DevelopmentAid: https://www.developmentaid.org/news-stream/post/209248/germany-plans-to-reduce-climate-related-aid
Ukranews on the BND report: https://ukranews.com/en/amp/news/1072951-german-intelligence-warns-russia-may-start-large-scale-conflict-with-nato-by-end-of-decade
RoIC on Russian and European spending: https://www.roic.ai/news/putin-denies-plans-to-attack-europe-but-military-spending-tells-a-different-story-10-01-2026
AP via KY Free Press: https://www.kyfreepress.com.au/world/merzs-militarisation-of-germany-concerning-russia
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