Germany walks back plan to meet NATO spending target on annual basis

By Holger Hansen

BERLIN (Reuters) -The German government has retreated from a plan to legally commit itself to meeting NATO’s 2% military spending target on an annual basis, a government source told Reuters on Wednesday.

A corresponding clause in a draft of the budget financing law passed by the cabinet of Chancellor Olaf Scholz on Wednesday was deleted at short notice, the source said.

The change means that Germany will be able to stick to its current pledge of meeting the 2% target on average over a five-year period.

This wording is softer than Scholz’s original pledge in a speech on Feb 27, 2022, in which he announced a “Zeitenwende” or sea change three days after Russia’s invasion of Ukraine.

“From now on, we will invest more than 2% of the GDP into our defence year after year,” Scholz said at the time.

A German government spokesperson declined to comment on the particulars of the draft law.

NATO allies have criticised Berlin strongly in the past for not spending 2% of its gross domestic product on defence annually.

It is unclear whether Berlin will keep military spending over this threshold once a 100 billion euro ($101 billion) special fund to bring the Bundeswehr back up to standard is used up.

(Reporting by Holger Hansen, Miranda Murray and Sabine Siebold, Writing by Friederike Heine, Editing by Rachel More)