Germany’s Bundesrat upper house of parliament on Friday approved plans for a spending splurge that aims to revive growth in Europe’s largest economy and scale up the military, clearing the final hurdle for the historic policy shift.
Ending decades of German fiscal conservatism, the legislation creates a 500 billion euro ($546 billion) fund to spend on infrastructure and eases strict borrowing rules to allow higher spending on defence.
The conservatives and SPD, who are in talks to form a coalition after last month’s election, pushed the package through the outgoing parliament in case it was blocked by an enlarged contingent of far-left and far-right lawmakers in the next Bundestag starting on March 25.
Chancellor-in-waiting Friedrich Merz has defended the tight timetable, which angered fringe opposition parties, by pointing to a rapidly changing geopolitical situation.
European leaders fear shifts in US policy under President Donald Trump in particular could leave the continent exposed to an increasingly hostile Russia and assertive China.
“The threat from the East, from Moscow, is still present, while the support from the West is no longer what we were once accustomed to,” said Bavarian Premier Markus Soeder.
“I am a convinced transatlanticist, but the relationship of trust in the US has, at least for me and for many others, been deeply shaken. The Germans are worried.”