Defence and Security: What is Germany’s strategy?

Faced with a tense Europe in search of security, Germany, long criticized for its post-Cold War underfunding, unveils its trump card: a special €100 billion fund and a promise to increase the defense budget to €51.8 billion by 2024. But while Berlin is focusing heavily on transatlantic acquisitions, European projects are struggling to get off the ground. At a time when the EU is calling for unity, what direction will Germany take on the European defense chessboard and for its own security strategy?

By Myriam Boumahdi

A Mixed Arms Export Policy

With a budget of €50.4 billion in 2022, Germany is aiming for €51.8 billion in 2024 to reach NATO’s target of 2% of GDP. In February 2022, Chancellor Scholz also announced the creation of a special 100-billion-euro fund, a real re-equipment program designed to make it “Europe’s leading army.” It could contribute to the modernization of the Bundeswehr, but would require an overhaul of the German procurement system. Berlin is determined to adopt a new industrial strategy in the face of current challenges, choosing certain “key technologies” to be kept in Germany for reasons of national security. It is also considering taking greater advantage of Article 346 (Treaty on the Functioning of the European Union), a clause in the EU treaties that could allow national manufacturers to be bolstered by lifting certain European competition rules. But according to Ischinger, by 2023, this strategy will still not have been fully implemented, despite the “wartime economy,”1 a reminder of Germany’s urgent need to adapt to avoid a repeat of the delays in the delivery and operationalization of systems crucial to the armed forces, not to mention the significant cost overruns on some major projects, such as the Leopard 2 tank and the MEADS air defense system. The latter represents a 15% increase on initial estimates.Berlin seems to have taken steps to overcome these obstacles with the acceleration of production of the Leopard 2 tank, which has particularly benefited Ukraine.“In France, the State, the bureaucracy and the defense industry are closely linked, unlike in Germany. There are three main reasons for this distinction: economic, bureaucratic and cultural. In the past, German defense companies, privately owned, have found it difficult to keep their commitments, which has strained relations. Second, there has long been an arms-length relationship. But under the leadership of the current Minister of Defence, Boris Pistorius, the German government is becoming more interventionist, with reforms aimed at improving the sector. Third, public perception of the defense industry in Germany is evolving, although it still differs from that in France or the UK. We can expect arms export procedures to close allies, such as EU or NATO members, to become much more streamlined. This is the result of a realization that situations like the one we are seeing in Ukraine should not be repeated.” emphasizes Dr. Leonard Schütte, Senior researcher at Munich Security Conference.

The war in Ukraine has transformed Germany’s arms export policy.“Germany faces a major dilemma: on the one hand, there’s a strong tradition of following ethical principles, refraining from sending weapons to conflict zones.On the other hand, there is now a precedent with aid to Ukraine, reflecting a need to maintain strategic partnerships in Europe and beyond” adds Dr. Schütte.

Positions That Remain Ambivalent

Against the current debates on the future of Franco-German cooperation programs (Franco-German combat air system, Franco-German land combat system, CIFS, Eurodrone) and the European Commission’s defense industry support initiatives (EDIRPA, Act to Support Ammunition Production-ASAP), Germany’s position raises questions due to its ambivalent nature. It has allocated 10 billion euros from the national fund to the purchase of 35 F-35 fighter jets, 60 Chinook helicopters and 8 P-8 Poseidon aircraft, all made in the USA, while the SCAF agreement between Dassault and Airbus, which involves France, Germany and Spain and is estimated to cost around 100 billion euros, is struggling to get off the ground. Even though this ambitious project would replace France’s Rafale and Germany’s and Spain’s Eurofighter. The MGCS (Main Ground Combat System) will by operational by 2040-2045.2 Criticism then arose from several European countries, denouncing Germany’s preference for transatlantic suppliers to the expense of European players.

However, the German strategy emphasizes the government’s commitment to strengthening the European Defense Technological and Industrial Base (EDTIB) and giving priority to “European solutions” for military procurement. Germany is trying to balance restraint and strategy, and while the country recognizes the importance of greater coordination between EU Member States on defense matters, “in Berlin, particularly within the ministries, there is still skepticism about the real contribution of the European Commission in defense policy, which is often perceived as going beyond its remit. Many are reluctant to give it more powers. The surprise at some of the Commission’s proposals, especially at the regulatory levels in ASAP, didn’t help. This situation is part of a wider debate on European industrial policy, which Germany has long been reluctant to engage with. Whether EDIP succeeds will also depend on how closely member states will be consulted in the process, as Germany, like others, has previously felt insufficiently included,” says Dr. Schütte.

Such statements remain far removed from reality, and from decisions taken by Germany in terms of military capability.3 Following the mid-term review of the EU’s multiannual financial framework (2021–2027), Germany remains wary of the European Commission’s increased role, refraining from voting to increase the latter’s defense budget. It did, however, welcome other initiatives such as the increase in funding for the European Peace Facility, which aims to strengthen its capacity to prevent conflict, promote peace and reinforce international security.

Towards International Cooperation

While Germany’s approach to security has a certain influence on Europe’s strategic posture, Chancellor Scholz spoke of a greater willingness to engage in ad hoc coalitions, using Article 44 of the Treaty on European Union. “This path towards more security and less dependence is one we are resolutely following. We are basing this on a broad concept of security. We need a secure supply of energy and raw materials for our country. That is why we are investing in new partnerships with the up and coming countries in Asia, Africa and America and are widening our trade relations.”4 Germany’s forthcoming strategy on China, with its emphasis on maritime security and a possible presence in the Indo-Pacific, will be closely scrutinized. “Countries like India are emerging as potentially key partners. This dynamic suggests a potential reassessment of arms export policy, where greater export flexibility could prevail,” stresses Dr. Schütte.

A German strategy that reflects “a new strategic realism (…), particularly with regard to Russia and China, or in the field of nuclear deterrence,”5emphasizes Bruno Tertrais, Senior Fellow – geopolitics, international relations and demographics at Institut Montaigne. The country “has reverted to its pre-Wall culture: a conventional army, which must maintain a level of power sufficient to deter any potential aggressor, geared towards high intensity,”concludes Léo Péria-Peigné.6






6 Ibid