Germany's next leader looks to boost defence spending

Germany's new chancellor-in-waiting, Friedrich Merz, is facing significant fiscal challenges in his bid to boost the nation's defense spending.

Following his party's recent election win, Merz has prioritized bolstering Germany's defense infrastructure, especially in light of recent global tensions and shifting alliances.

Merz had about 90 minutes of talks with outgoing chancellor Olaf Scholz on Tuesday local time and discussed ways to circumvent strict restrictions on debt so he could spend more on the military.

There is increased urgency to raise military spending, due to concerns over the United States' potential isolationist stance under President Donald Trump, and the need for Europe to assume greater independence for its security. However, efforts are impeded by the constitutional "debt brake" which restricts federal borrowing to 0.35% of the nation's GDP.

To navigate the debt brake constraints,.. Merz is exploring the establishment of a special defense fund, potentially amounting to 200 billion euros.