Germany to borrow at least $220 billion to fund historic reset

Germany to borrow at least $220 billion to fund historic reset

Bloomberg: Germany plans additional borrowing of at least 200 billion euros ($220 billion) this year to finance a fund to modernize the military alongside already-planned debt for climate protection and other initiatives.

The latest borrowing binge marks the third consecutive year that Germany has breached constitutional limits and highlights how the new government is prepared to unleash massive spending to deal with seismic events like the pandemic and the war in Ukraine.

In the 2022 federal budget — approved by the cabinet — the government is targeting as much as 99.7 billion euros in new borrowing, in line with previous planning, though the final figure is likely to be even higher when the impact of Russia’s invasion of Ukraine is taken into account. Another 100 billion euros will come on top for defense in a dedicated off-budget fund.