Overview

• The €500 billion special fund will finance infrastructure, climate initiatives, and defense, including expanded definitions for security-related spending.
• The agreement includes €100 billion allocated to the Climate and Transformation Fund, with 'climate neutrality by 2045' now enshrined in the German Constitution.
• The deal requires constitutional amendments to loosen the debt brake, with a two-thirds majority vote planned in both the Bundestag and Bundesrat next week.
• The Greens successfully pushed for stricter criteria ensuring the funds are used for new projects rather than existing obligations or consumptive expenditures.
• The package has drawn mixed reactions, with praise from environmental and economic groups but criticism from the AfD, FDP, and Left Party over its fiscal and policy implications.