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NATO goal uncertain as German defense spending falls short

Germany’s ability to fulfill its NATO commitment of spending at least 2% of its economic output on defense in the long run is in doubt, as stated by the Ifo Institute. The institute explains that shifts in spending from the regular budget will necessitate the allocation of approximately one-third of Germany’s €100 billion special armed forces fund to make up for the shortfall. This leaves only around €50 billion in the fund for new military equipment, considering inflation and interest payments.

Ifo researcher Florian Dorn emphasizes that a significant increase in the core defense budget is required to maintain defense spending at 2% of economic output in the medium term. However, the opposite is happening, according to Ifo. In 2022, the defense budget had allocated €10 billion for new equipment, but this amount has dropped below €3 billion for 2024.NATO Countries Names List and Map 2023_30.1

In response to Russia’s invasion of Ukraine in February 2022, Chancellor Olaf Scholz introduced the special fund, marking a turning point in Germany’s military stance. After years of neglecting the armed forces, the government now faces a considerable catch-up effort. NATO estimates suggest that Germany’s regular defense budget will amount to 1.57% of its economic output in 2023. To counter this trend, Scholz’s ruling coalition plans to prioritize defense spending in next year’s finance plan, setting aside €71 billion for defense.NATO Has Switched to War Footing With Russia

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