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Germany: uncertain future of further military support to Ukraine

Lidia Gibadło
Piotr Szymański

On 17 August, the Frankfurter Allgemeine Sonntagszeitung newspaper (FAS) published information regarding the German government’s decision not to increase military support for Ukraine in excess of the funds which have been earmarked in this year’s budget plan. The authors of the report cite a letter written on 5 August, which Germany’s Minister of Finance Christian Lindner (FDP), in agreement with the German Chancellery, sent to Minister of Defence Boris Pistorius (SPD) and Minister of Foreign Affairs Annalena Baerbock (Greens). The letter indicated that the funding of new military procurement orders for Kyiv will be conditional on the availability of funds earmarked for that purpose in this year’s budget (around €8 bn) and in the budgets for the next few years (around €4 bn in 2025). However, according to media reports, funds from both of these tranches have been earmarked fenced off for the implementation of projects which had previously been submitted. The FAS also argues that the government plans to reduce the sum allocated for support to Ukraine in the coming years: in 2026 this will be €3 bn, and in both 2027 and 2028 it will be down to €0.5 bn. The Bundestag will consider the 2025 draft budget in the first half of September.

The German Chancellery has not refuted this information and only stated that Kyiv will continue to receive support “as long as this is necessary”. Chancellor Olaf Scholz (SPD) for his part highlighted a facility worth €50 bn, which the G7 states adopted in June as a method for funding the cost of further assistance. Until recently, funds spent on Germany’s military support to Ukraine came from a government-sponsored programme for providing military support to Germany’s partner countries (Ertüchtigungsinitiative der Bundesregierung, EIBReg), and this year there was also a special purpose fund for the modernisation of the German Armed Forces (see ‘Germany boosts its funding for military support to Ukraine’). According to the German defence ministry, between 24 February 2022 and 15 May 2024 Berlin provided Kyiv with military assistance worth €8.71 bn.

Commentary

  • The intention to limit additional support to Ukraine offered from the German state budget results from the government’s decision to save funds and maintain its so-called ‘debt brake’, which prevents the state from increasing its deficit in excess of 0.35% of its GDP. Berlin’s assumption that the cost of new arms supplies to Kyiv will be covered from loans, which are still available this year and funded by the G7 states, is risky. These loans are expected to be repaid using the proceeds generated by trading in so-called extraordinary profits from frozen Russian assets in G7 countries (see ‘The G7 summit: $50 billion has been promised to Ukraine’). However, there is no guarantee that this mechanism will be launched in the coming months. The blockade of new budgetary funds for armament and military equipment supplies in the next few years may therefore weaken long-term efforts to boost Kyiv’s military potential. Germany has failed to fully utilise the funds which have thus far been earmarked for military support to Ukraine and the supplies under contract are being carried out with delays.
  • By blocking additional financial assistance, the ruling SPD and FDP also intended to achieve certain electoral benefits. The SPD may use this decision as an argument targeted at voters who are unconvinced that Germany should continue helping Kyiv and support the pro-Russian extremist AfD and BSW parties, which are enjoying a high level of support ahead of the September elections in the eastern federal states (they are backed by 24–32% and 17–19% of the electorate respectively). For the supporters of the German liberals, the decision adds credibility to the party’s determination to maintain the debt brake. The FDP is hoping that implementation of this proposal will enable it to cross the 5% threshold in the federal elections in 2025 (see ‘Germany: government reaches budget compromise for survival’). The government’s plan has come under criticism from some politicians representing the ruling SPD and the Greens, as well as the opposition CDU/CSU, who mainly emphasise Germany’s reputational damage and the fact that uncertainty regarding further military support weakens Ukraine.
  • The information chaos surrounding the debate on Germany’s military support to Kyiv undermines both the West’s credibility and Germany’s reputation. It also has a NATO-related dimension. On the basis of decisions made during its July summit held in Washington, NATO has taken over the coordination of military support and the training of Ukrainian troops, and pledged to provide Ukraine with military assistance worth at least €40 bn annually. This assistance should be split among the NATO countries in proportion to their economic potential. In 2023, Germany’s share in NATO members’ total GDP stood at around 8.6%. Thus, Germany would be obliged to provide support worth just slightly less than €3.5 bn. This sum could, for example, include the contributions to NATO-Ukraine Trust Funds and the supplies of non-lethal equipment. Thus, NATO’s new programme for Kyiv involves the risk that the states which have so far shouldered the greatest burden of providing military assistance to Kyiv may reduce their involvement to the lowest agreed level, that is to their share in the pledged €40 bn. If Germany slashes its contribution to below the expected GDP-based threshold, it would once again come under diplomatic criticism within NATO (previously it was criticised for failing to meet the NATO guideline to spend at least 2% of GDP on defence until 2024).