The German government agreed with the opposition to create a fund of 100 billion euros to modernize its army in the face of the Russian threat

The German government has signed an agreement with the conservative opposition to create a special military procurement fund worth 100 billion euros to modernize the German army in the face of the Russian threat. It also allows Berlin to achieve NATO’s goal of having each member state spend 2 percent of its GDP on defence.

The emergency fund would be financed by additional debt, so it was necessary to bypass the “debt limit” law enshrined in the constitution, which limits government borrowing.

The agreement, which also includes constitutional amendments, came after weeks of difficult negotiations between the ruling coalition parties and the Conservatives, led by former Chancellor Angela Merkel.

German Chancellor Olaf Scholz promised, three days after Russia’s war with Ukraine last February, to allocate a budget of 100 billion euros to rearm the German army and modernize its equipment over the next few years.