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Germany Approves Historic €500 Billion Infrastructure and Defense Investment Plan

The agreement between CDU and SPD marks a major shift in fiscal policy, loosening debt rules to address infrastructure, defense, and economic challenges.

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US-Präsident Donald Trump verlässt nach einer Rede bei einer gemeinsamen Sitzung des Kongresses im Kapitol in Washington den Plenarsaal.
Andreas Dressel (SPD), Senator für Finanzen in Hamburg, hatte immer darauf gepocht, dass die CDU von ihrer Position zu mehr Investitionen abrückt

Overview

  • Germany's CDU and SPD have agreed on a €500 billion investment package, focusing on infrastructure improvements and defense upgrades, in response to growing economic and security pressures.
  • The plan includes a significant loosening of Germany's debt rules, allowing for increased borrowing to fund projects such as bridge repairs, road upgrades, and digital infrastructure expansion.
  • The decision comes amid concerns over reduced U.S. support for European defense under President Donald Trump, prompting Germany to bolster its military capabilities independently.
  • Critics, including members of the CDU and economists, have raised concerns about the long-term sustainability of the debt-funded approach and the potential for inefficiencies in spending.
  • The agreement requires constitutional amendments, necessitating a two-thirds majority in the Bundestag, with the Greens' support being crucial for its passage.