€100bn German defence fund: Scholz confident of deal with opposition

The creation of a special fund for the German army totalling €100 billion ($105 million) has hit some political hurdles in parliament, but Chancellor Olaf Scholz expressed confidence on Tuesday that lawmakers would reach a deal.

He was counting on the “patriotic cooperation” of his coalition government with the conservative opposition, the Social Democrat (SPD) leader he said in Berlin on Tuesday.

“These talks are taking place. And my impression is that they are on the right path,” he said.

Scholz announced the massive investment programme just days after the start of the war in Ukraine, arguing that the Russian invasion represented a “turning point in history,” and that Germany’s underfunded military needed to be able to face new threats.

The rearmament programme has to be anchored in the German constitution as it is to be financed entirely from loans, bypassing the debt limits written into the Basic Law.

Changes to the constitution require a two-thirds majority in the Bundestag, which means Scholz has to convince the conservative opposition to come on board.

Negotiations have been going on for weeks, and a first debate on the plan was taken off the parliamentary agenda for this week.

The conservative Christian Democratic Union (CDU) and Christian Social Union (CSU) have set conditions for their approval, reportedly including clarification that the special fund will be used exclusively for the Bundeswehr, and not for any other defence-related projects.

Conservative leader Friedrich Merz said on Tuesday that the reasons for the delay lay within Scholz’s coalition.

“The issue is not with us, but with the unity in the coalition. Once the coalition has a consensus, then we can come to an agreement very quickly,” he said.

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