Germany Hikes Ukraine Military Support But is Its Defence-Spending Tilt Tenable?

 

As the Ukraine war grinds on, and with the Israel-Hamas war grabbing international attention, many Ukrainians fear that their existential struggle against Russia will be overlooked. The looming 2024 US election campaign is doing nothing to assuage their anxieties. But Kyiv can count on the support of Germany, which is set to double its military aid to Ukraine.

In an interview with German broadcaster ARD, Defence Minister Boris Pistorius said the move sent a “strong signal to Ukraine that we will not leave them in the lurch”.

The Ukraine military aid hike from €4 billion to €8 billion would mean Germany’s annual budget allocation would be enough to last Ukraine the entire year, noted Pistorius. The budget boost, he told ARD, was a response to this year's experience, "which showed that planned amounts were quickly exhausted" by Ukraine’s major military needs.

The €8 billion military aid announcement was a marked shift from Germany’s infamous “5,000 protective helmets” offering just weeks before Moscow launched its full-scale invasion of Ukraine last year. It was a clear sign of a change in German policy, which was once considered a weak link in the Western response to Russian aggression due to its dependence on cheap Russian energy and its postwar commitment to pacifism. 

From weak link to ‘backbone’ of European defence

Back in January 2022, when Ukraine, faced with an imminent invasion, turned to NATO for military help, the US and UK immediately agreed to provide Kyiv with defensive weapons.

When Germany, Europe’s largest economy, offered just 5,000 protective helmets, it was the subject of much scorn across Ukraine, prompting Kyiv’s mayor to publicly ask if the next delivery would be pillows.

"Military aid to Ukraine gave rise to a particularly difficult debate in Germany, for both historical and economic reasons," noted Éric-André Martin from the Paris-based French Institute of International Relations (IFRI). "Not only is it the country's policy not to supply arms to a country at war, but German officials were also very uncomfortable with the idea of opposing Russia, which supplied them with 50% of their gas." 

A year after the helmet affair, Christine Lambrecht from Chancellor Olaf Scholz’s Social Democratic Party (SPD) resigned as Germany’s defence minister. Her New Year’s Eve address, when she said the Russian invasion gave her the chance for “many encounters with great and interesting people” was one gaffe too many, undermining Germany’s credibility on the international stage.

Then came the controversy surrounding the delivery of German Leopard 2 tanks to Ukraine. Just as Kyiv was putting up a valiant offensive against its giant invader, Germany not only refused to supply the much-needed tanks, it opposed re-exporting tanks purchased by its allies to Ukraine.

Finally, after Scholz visited Washington and convinced US President Joe Biden to send American Abrams tanks, the German chancellor yielded to pressure. In a January 25, 2023 speech to parliament, Scholz announced that Germany would be sending Leopard 2 tanks to Ukraine.

"Germany was not the only European country afraid of adding fuel to the fire by delivering advanced military equipment to Ukraine to fight Russia. But it is true that for a long time it was particularly cautious," said Gaspard Schnitzler, research director at the French Institute for International and Strategic Affairs (IRIS).

"This difficulty in making decisions is linked to Germany's political configuration,” said Schnitzler, noting that Scholz’s governing coalition includes three political parties “with very different perspectives, to a policy of drastic export controls, and also to the German constitution, adopted after the Second World War to avoid a concentration of power. Decisions are taken collegially, and therefore take longer to reach, which was difficult for its partners to understand. But it can also be argued that once they are made, they are more definitive.”

Almost two years after the start of the war, Germany has gradually emerged as Kyiv's leading military supporter in Europe. According to the Kiel Institute’s Ukraine support tracker, Berlin has committed over €17.1 billion in military aid to Ukraine since January 24, 2022. This is certainly not on a par with Washington's €42 billion, but it is more than twice the UK's investment (7 billion) and 34 times that of France.

This investment has increased considerably over the past year, with the delivery of Leopard 2 tanks, Gepard air defence systems and shells.

"Today, Germany wants to be exemplary in its support for Ukraine, to make up for its hesitations at the start of the war, but also its policy of economic openness towards Russia. The signing of the Nord Stream II gas pipeline after the [2014] annexation of Crimea was very badly received by Ukraine, the Baltic States and Poland," explained Schnitzler.

Bundeswehr on the rise

For Germany, this massive support for Ukraine is first and foremost a question of national security. Realising the scale of the threat to its own security posed by Russia's conquest of Ukraine, Berlin began a radical military rearmament shift soon after the war erupted, breaking with decades of underinvestment.

After a February 2022 announcement of a special fund of €100 billion over five years to modernise the Bundeswehr, the German armed forces, Berlin adopted its first-ever "National Security Strategy" in June. On November 9, Pistorius unveiled his defence policy guidelines, promising to make Germany “the backbone of deterrence and collective defence in Europe”.

"The amount announced may seem very substantial, but it's important to understand that this is above all a catch-up investment," stressed Martin.

"Germany was well below NATO's commitments, which set defence spending at 2% of GDP. It was something of a freeloader in its contribution to European defence. In the name of budgetary stability, it shifted the burden to other members of the Alliance, and in particular the US, which led to sharp tensions with Donald Trump,” Martin added.

With this strategic turnaround, Berlin intends to transform its defence policy for the long term. The aim is to reassure the US, and to offer a hierarchical military framework within NATO into which European countries with fewer resources can integrate their battalions.

A change of gear in times of crisis

According to Pistorius, Germany's status as Europe's largest economy gives it a special "responsibility" to defend the bloc, which it now intends to assume.

However, this ambitious transformation comes at a time of economic turbulence. Germany, which had based its energy strategy on supplies of cheap Russian gas, is in the front line of the inflationary crisis that has hit the continent since the outbreak of the Ukraine war and the introduction of sanctions against Moscow.

"The country relied on Russian energy to implement its transition to renewables. Now it has to source its energy elsewhere, and at a much higher cost. Add to this the slow pace of industrial transition, as Germany has invested little in electric vehicles, and its automotive sector is losing competitiveness to the Chinese," explained Martin.

Against this backdrop, at the beginning of October, the IMF revised its forecasts for the German economy's contraction, now predicting a drop in GDP of -0.5% versus the previous -0.3% for 2023, by far the worst annual performance of the bloc's economies.

"The special fund of €100 billion over five years to finance the army pales in comparison with Germany's GDP of €4,000 billion. The same applies to the envelope dedicated to Ukraine support. But the difficulty is that for these investments to be effective, they must be sustained over time," said Martin. "If the economic difficulties persist and have too heavy an impact on German households, the government could be forced to reassess its budgetary choices.”

"The Russian invasion has broken the taboo on the issue of national defence in Germany," said Schnitzler. "The vast majority of Germans are in favour of supporting Ukraine, despite the cost, and are now aware of the importance of strengthening their army."

Schnitzler nevertheless believes that, despite favourable public opinion, several questions about Berlin's ability to maintain this policy persist.

"We're still feeling our way around the financing of German rearmament. To be sustainable, these investments need to be gradually shifted to the defence budget, but for the time being everything is still based on the special €100 billion fund.

Finally, it’s hard to predict what will happen to this policy once the war in Ukraine is over. Once the immediate threat has been averted, it's always harder to justify high levels of military spending to the public.