Damaged buildings in the ruins after a Russian missile attack in Mirnohrad, Donetsk Oblast, Ukraine, on July 16, 2024.
Jose Colón | Anadolu | Getty Images
Germany’s draft budget for 2025 shows that Germany will significantly reduce funds dedicated to strengthening partner countries in the fields of security, defense and stability – part of the country’s budget usually includes support for Ukraine.
Funding to support partner countries will be cut to 4 billion euros ($4.4 billion) by 2025 from 7.5 billion euros in 2024, according to a draft budget seen by CNBC. The budget outline shows that the allocation of this fund in 2023 is approximately 5.4 billion euros.
In recent years, this part of Germany’s budget has been allocated heavily to support Ukraine in the wake of Russia’s attacks on the country.
According to the draft budget, the German government now expects Ukraine to be able to meet most of its military needs and requirements through the $50 billion support package agreed last month by the G7.
The statement also stated that Germany will cooperate with its allies and continue to support Ukraine as needed.
“Thanks to European instruments and G7 loans, Ukraine’s financing is secured for the foreseeable future,” German Finance Minister Christian Lindner said at a press conference on Wednesday, Reuters reported.
Uncertainty about future aid to Ukraine is rising as former President Donald Trump’s chances of winning back the White House appear to be growing. The possibility of Trump being re-elected as president has raised concerns about whether the United States will cut or halt aid to Ukraine.
Trump’s vice presidential nominee, Senator Vance, also strongly opposes providing more aid to Ukraine.
After intense negotiations, coalition leaders finally announced their 2025 budget plans earlier this month, and the German cabinet approved Germany’s spending plans on Wednesday. At the time, German Chancellor Olaf Schulz made defense one of the cornerstones of the budget.
The draft budget outlines the government’s plan to spend more than 2% of gross domestic product on defense and security – an increase in spending in response to the war between Russia and Ukraine. The NATO military alliance stipulates that member states should spend at least 2% of their GDP on defense.
Germany’s budget planning was thrown into crisis last year when a Constitutional Court ruling left a 60 billion euro shortfall in several years of spending plans. The government plans to reallocate unused emergency debt during the Covid-19 pandemic into future spending plans. The court called the move unconstitutional.
The German parliament will debate the draft budget after the summer break in September before finalizing it later this year.
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