Germany’s federal government has approved the draft federal budget for 2027, with a significant boost to defense spending.

Under the plan, Germany expects total spending of about €555.4 billion in 2027, with new borrowing of roughly €203.6 billion as part of a medium-term framework running to 2030. The government said the increase reflects the need to invest in resilience and security amid war-related economic pressures.

A key element is a planned rise in Bundeswehr funding. Core defense spending is set to climb to around €109 billion in 2027 from about €82.2 billion in 2026—an increase of roughly one-third. The wider security-related total is higher when support for Ukraine and other measures are included.

Finance Minister Lars Klingbeil defended the budget stance, arguing Germany cannot defend itself “with a balanced-budget policy” and pointing to the need to make up for decades of underinvestment in defense capability. He also said discussions in parliament would begin after the summer recess, with final approval expected by the end of the year.