Germany has announced plans to significantly increase its defense spending, aiming to raise core defense expenditure to 3.5% of GDP by 2029, up from 2.4% in 2025. This move is part of Berlin's commitment to meet NATO's new defense spending targets well ahead of the 2035 deadline. The government has outlined budget plans detailing the annual spending ramp-up, supported by Germany's low debt levels and adjustments to its debt brake rules. Concurrently, Germany is preparing a major procurement program estimated at up to €25 billion to acquire up to 1,000 Leopard 2 main battle tanks and 2,500 Boxer armored fighting vehicles over the next decade. This acquisition aims to equip seven new NATO brigades and bolster deterrence against Russia. The procurement is part of a broader European effort to enhance NATO's military capabilities. Additionally, German defense company Rheinmetall anticipates orders worth up to €70 billion from the Bundeswehr, including deliveries of thousands of armored vehicles such as Leopard 2 tanks, Puma infantry fighting vehicles, and Boxer armored personnel carriers.

Germany’s Minimum Wage Commission recommended on Friday that the statutory hourly minimum wage be raised in two stages from the current €12.82 to €13.90 on 1 January 2026 and €14.60 on 1 January 2027. The unanimous proposal, agreed after what the panel described as “very difficult discussions,” must be converted into law by the Federal Labour Ministry. Labour Minister Bärbel Bas welcomed the accord, calling it proof that Germany’s system of collective decision-making between employers and unions “works.” Even so, the compromise falls short of the €15 target the Social Democratic Party (SPD) had sought, a gap that could stoke further tension inside Chancellor Friedrich Merz’s three-party coalition. The 14 percent rise would lift gross earnings for a full-time minimum-wage worker to roughly €2,500 a month, giving Germany the second-highest minimum wage in the European Union after Luxembourg, according to Eurostat data. Supporters argue the move will bolster household purchasing power at a time of weak economic growth. Business organisations cautioned that higher labour costs could curb hiring, particularly among small companies and in low-skill occupations, where unemployment has already been inching up. The Labour Ministry is expected to decide on the legal implementation in the coming weeks.

Germany is planning a major military procurement program estimated at up to €25 billion to enhance its armored vehicle fleet and strengthen NATO forces amid ongoing security concerns related to Russia. The plan involves purchasing up to 1,000 Leopard 2 main battle tanks and 2,500 GTK Boxer armored fighting vehicles over the next decade. This acquisition aims to equip up to seven new NATO brigades, each comprising approximately 35,000 personnel, as part of a joint European effort to bolster deterrence against Russia. The initiative follows NATO's request for Berlin to form these combat brigades to reinforce collective defense capabilities. The procurement is considered one of the largest armored vehicle orders in recent history and reflects Germany's commitment to significantly upgrading its military capabilities. Separately, major German companies including Siemens and Deutsche Bank are collaborating on an investment initiative designed to boost investor confidence and support sustainable economic growth in Europe's largest economy.

The German cabinet has approved a draft 2025 federal budget that puts defence spending on track to reach 3.5% of gross domestic product by 2029, up from about 2.4% this year. The move would allow Berlin to meet a new NATO benchmark six years ahead of the alliance’s 2035 deadline and represents a further break with the country’s post-Cold-War reluctance to expand its military outlays. Budget papers cited by government officials show military expenditure rising from roughly €95 billion in 2025 to about €162 billion in 2029. The ramp-up will be financed with the remainder of a €100 billion special defence fund created after Russia’s 2022 invasion of Ukraine and with an exemption to Germany’s constitutional debt brake that permits up to €378 billion of defence borrowing between 2025 and 2029. Around €9 billion a year is earmarked for military aid to Ukraine over the same period. Defence Minister Boris Pistorius said the Bundeswehr aims to expand its active force from about 183,000 soldiers to 260,000 by 2035, warning that compulsory military service could return if voluntary recruitment falls short. Chancellor Friedrich Merz has pledged to build the “strongest conventional army in Europe,” underscoring Germany’s rapid strategic shift as NATO allies prepare for a summit focused on higher defence commitments.

Germany's largest banking group, Sparkassen, plans to introduce cryptocurrency trading services for retail customers by summer 2026. This marks a reversal of their stance from three years ago when they rejected digital asset offerings. The Sparkassen group comprises over 370 local savings banks and serves more than 50 million customers, positioning it as one of Europe's largest banking networks. Concurrently, Deutsche Bank, another major German financial institution valued at approximately $1 trillion, is preparing to launch Bitcoin and cryptocurrency custody services in 2026. Deutsche Bank is collaborating with Bitpanda’s technology subsidiary and Swiss digital asset infrastructure provider Taurus SA to develop the custody platform. The bank is also exploring stablecoins, tokenized deposits, and the potential issuance of its own digital token. These moves by two of Germany's leading banks signal a broader institutional embrace of digital assets and cryptocurrency services in the country.

Germany has announced plans to increase its core defense spending to 3.5% of GDP by 2029, up from 2.4% in 2025, aiming to meet NATO's new defense spending target years ahead of the 2035 deadline. This increase represents a more than two-thirds rise in military expenditure, with the defense budget expected to reach approximately 153 to 162 billion euros by 2029. The German government has published detailed budget plans outlining annual spending increments to achieve this goal. As part of this military expansion, Germany plans to invest around 25 billion euros in tank production, potentially acquiring up to 1,000 battle tanks and 2,500 armored fighting vehicles to strengthen NATO brigades and deter Russia. Additionally, Germany is considering reintroducing national service, with proposals for a six-month voluntary military service to train recruits in basic tasks, while the possibility of reinstating compulsory conscription remains under parliamentary discussion. The Social Democratic Party (SPD) supports the return of mandatory military service, and public opinion polls indicate growing approval for conscription applying to both men and women. These defense initiatives are facilitated by Germany's low debt levels and the easing of fiscal constraints such as the debt brake, enabling increased military investment amid broader efforts to enhance national security and support Ukraine with approximately 9 billion euros annually from 2025 to 2029.

Germany's Federal Administrative Court in Leipzig overturned the ban on the right-wing extremist magazine "Compact" on June 24, 2025. The ban had been imposed in 2024 by then Interior Minister Nancy Faeser of the Social Democratic Party. The court ruled that despite the magazine's far-right content, including criticism of mass migration and accusations of antisemitism and anti-Israel sentiment, the expressions did not meet the threshold for a constitutional ban and remain protected under Germany's Basic Law guaranteeing freedom of expression and press freedom. The ruling emphasized that even provocative or extremist speech is covered by these rights unless it is clearly unconstitutional. The decision was described as a victory for press freedom and free speech, and it may have implications for ongoing debates about banning the far-right Alternative for Germany (AfD) party. The court acknowledged that while the magazine fulfills some criteria for prohibition, its content was not sufficiently predominant to justify the ban. The verdict was met with approval by supporters of the magazine and the AfD, while it was seen as a setback for Faeser and her efforts to restrict the publication. The case highlights tensions between combating extremism and upholding constitutional rights in Germany.

Germany’s coalition government approved a draft 2025 budget that sharply relaxes the country’s traditional fiscal restraints. Berlin plans to raise €118.5 billion in net new debt between July and September—about 20% more than previously envisaged—to finance a surge in infrastructure and defence spending. The blueprint envisages public investment of €115.7 billion next year and at least €120 billion annually through 2029. Finance Minister Lars Klingbeil said the package will lift military outlays to 3.5% of GDP by 2029, meeting NATO goals three years earlier than planned. Germany’s debt load, currently about 63% of GDP, would remain among the lowest in the euro area, but the budget deficit is forecast to top 3.2% of output by the end of the parliamentary term. Economists at Berenberg expect the fiscal stimulus to nudge annual growth to roughly 1.25% after two consecutive years of contraction. Chancellor Friedrich Merz argues the spending drive is necessary to repair the country’s rail network, upgrade its power grid and modernise public housing and education. Analysts warn, however, that the benefits could be fleeting unless Berlin also trims bureaucratic hurdles that the ifo Institute estimates cost the economy close to €150 billion in lost output each year.

Germany's cabinet has approved a bilateral agreement with the Netherlands to drill for up to 13 billion cubic meters of natural gas in a protected marine site in the North Sea. The decision aims to enhance energy security amid efforts to replace Russian gas supplies and stabilize the European gas market. The drilling site is located in a UNESCO-protected area near Borkum, sparking criticism from environmentalists concerned about the impact on climate protection, marine space, and the local environment. The move marks a controversial shift in Germany's energy policy, which has previously included shutting down nuclear power plants while now permitting fossil fuel extraction in environmentally sensitive zones.

Germany is set to introduce a voluntary six-month military service starting January 2026, with the first recruits expected to begin training in May 2026. The initiative aims to bolster the country's reserve forces and strengthen national defense amid growing security concerns related to Russia. The program will focus on training recruits for basic roles such as guard duties. Defense Minister Boris Pistorius plans to submit the legislation for this new voluntary service by the end of August 2025. While the immediate focus is on voluntary enlistment, a draft system and the reintroduction of mandatory conscription remain possible as a last resort if volunteer numbers are insufficient. German President Frank-Walter Steinmeier has expressed support for reinstating compulsory military service, citing changes in the European security environment. The Bundeswehr is also training civilians as reservists to prepare for potential defense needs. The plan has elicited mixed reactions, including concerns from the business community about expanding conscription and reserve service obligations.

Germany's population increased slightly by 0.1% in 2024, reaching approximately 83.6 million people by the end of the year, according to preliminary data from the Federal Statistical Office. This growth represents a slowdown compared to 2023, when the population grew by 338,000. Despite more deaths than births in 2024—with a natural population decline of around 330,000—the overall population rose due to net immigration. Bavaria recorded the largest population increase among German states. The composition of the population is changing, with a rising proportion of foreign-born residents. The birth rate in Germany continued to decline, falling to 1.35 children per woman, the lowest in nearly two decades. This decline is particularly pronounced among women with German citizenship, who reached their lowest birth numbers in almost 30 years. Birth rates are higher among mothers of foreign origin but are also decreasing. Ethnic Germans accounted for about 40% of births in 2024, and projections suggest that by 2070, 80% of births in Germany will be to non-German mothers.

Germany is preparing to introduce a voluntary six-month military service program starting January 2026, with the first recruits expected to begin training in May 2026. The initiative aims to bolster the country's reserve forces and strengthen national defense amid growing security concerns related to Russia. Defense Minister Boris Pistorius plans to submit legislation for this new voluntary service by the end of August 2025. While the immediate focus is on attracting volunteers for basic roles such as guard duties, the legislation includes provisions for reintroducing compulsory conscription as a last resort if the voluntary system proves insufficient. A survey indicates strong public support in Germany for reinstating conscription, with increasing acceptance for it to apply to both men and women. The government intends to begin issuing questionnaires in 2026 and conduct mandatory medical examinations in 2027 as preparatory steps. Chancellor Merz has defended increased defense spending, emphasizing its importance for NATO and national security. However, the plan has elicited mixed reactions, including concerns from the business community and economic analysts about the potential costs of reinstating conscription.