Germany to Borrow Nearly €200 Billion in 2027 Budget, Sources Say
Germany's 2027 Budget Plans and Fiscal Strategy
By Maria Martinez
BERLIN, April 28 (Reuters) - The German government is working on a draft budget for 2027 which includes total borrowing of 196.5 billion euros ($229.73 billion), sources told Reuters on Tuesday.
Comparison with Previous Budgets
This compares with 50.5 billion euros in 2024 under the previous government, before Germany threw off decades of fiscal conservatism last year in an effort to revive growth, modernise crumbling infrastructure and scale up military spending.
Medium-Term Financial Framework
The 2027 draft budget, part of a medium-term financial framework extending to 2029, allocates total spending of 543.3 billion euros, sources said, 3.6% more than in the previous year.
Infrastructure and Defence Spending
The spending surge is supported by a 500 billion euro infrastructure fund and an exemption from debt rules for defence spending approved last year.
Breakdown of New Borrowing
New borrowing in the core budget is expected to rise to 110.8 billion euros, with 58.2 billion euros borrowed on top through the infrastructure fund and 27.5 billion euros borrowed through the special fund for defence approved by former chancellor Olaf Scholz following Russia's invasion of Ukraine.
Focus on Defence
Defence Budget Growth
The defence budget is set to climb to 105.8 billion euros in 2027 from 82.7 billion euros in 2026. A further increase to 179.9 billion euros is planned by 2030, the sources said.
Budget Approval Process
Parliamentary Discussions and Timeline
Following cabinet approval on Wednesday, budget discussions will commence in parliament in September, with final approval anticipated by year's end.
Currency Exchange Rate
($1 = 0.8554 euros)
Reporting Credits
(Reporting by Maria MartinezEditing by Madeline Chambers and Friederike Heine)
