The International Monetary Fund (IMF) has warned in a new analysis that high defence spending poses risks despite growth impulses. In Germany, Finance Minister Lars Klingbeil (SPD) plans about 83 billion euros for defence this year. Worldwide, roughly half of all countries have raised their military budgets over the past five years.
Finance Minister Lars Klingbeil (SPD) will meet counterparts at the IMF's spring meeting in Washington next week. About a year ago, the Bundestag loosened the debt brake to allow more borrowing for armament spending. Klingbeil has elevated the defence budget to the second-largest item in the federal budget – from 47 billion euros five years ago to 83 billion now.
The IMF analysis, published on Wednesday, examines whether rising state spending on rearmament can boost economic growth. The fund confirms positive effects but warns of negative side effects already emerging – including in Germany.
Amid geopolitical tensions, the IMF expects the spending trend to continue. Roughly half of all countries have increased their military budgets over the past five years.
