Will Germany deliver on its grand military ambitions?


Holzdorf military base was once the pride of Communist East Germany, a strategic linchpin for the Warsaw Pact countries who opposed Nato. Now it is being remade as one of the west’s biggest bulwarks against Russia.

The base’s runway is being expanded, so any plane in the Nato arsenal can land there. Soon it will take possession of 60 new Chinook heavy-lift helicopters and the Arrow air-defence system from Israel, capable of shooting down intercontinental ballistic missiles before they enter the Earth’s atmosphere.

“Over €500mn will be spent on new infrastructure here — hangars, maintenance bays and new flight operations areas,” says Colonel Christian Guntsch, the German military staff officer in charge of the expansion plan.

But the arrival of the Chinooks will be the “crowning glory” of the transformation, he says. They will replace Germany’s lumbering Sikorsky CH-53 choppers that have been in use since 1972, and are so old that the army has struggled to find spare parts when they break down.

The Chinooks and Arrow interceptors are being paid for out of a new €100bn debt-financed fund for the Bundeswehr, the German armed forces, that has become the centrepiece of Berlin’s new, more muscular approach to national security.

The investment fund highlights Germany’s goal of becoming Europe’s biggest military spender and providing its largest conventional army — a power capable of deploying huge resources at short notice to fight a potentially brutal land war on its doorstep.

Chancellor Olaf Scholz unveiled the cash injection just three days after Russia embarked on its full-scale invasion of Ukraine, in a speech to the Bundestag that described the war as a “Zeitenwende” — a watershed moment — in Germany’s modern history.

The commitment allowed Scholz to fulfil one of his key pledges: that Germany would dedicate 2 per cent of its gross domestic product to defence, a Nato goal it signed up to in 2014 and had, until this year, never achieved.

Germany will spend nearly €72bn on defence this year, more than it has ever done in the history of the Bundeswehr. Some €52bn will come from the regular budget and €19.8bn from the investment fund.

“The transformation we’ve seen since January 2022 has been revolutionary, compared to the policies Germany pursued in the past,” says Claudia Major, a defence analyst at the German Institute for International and Security Affairs.

But concern is growing about what will happen after 2027, when the fund has dried up.

Experts believe the country will then have to stump up an additional €25bn-€30bn a year out of the general budget to meet the 2 per cent goal — an eye-watering sum that could require swingeing cuts in welfare spending if the country is to balance the books.

“We need a broader discussion about where the additional €30bn are going to come from,” says Christoph Heusgen, the longtime foreign policy adviser to former chancellor Angela Merkel and now head of the Munich Security Conference, the “Davos of defence”, which opens this week.

“There is going to have to be a big debate about resources, and how they’re allocated,” he says. “And my impression is that the government is scared to have this discussion, and is just delaying it.”

There is one person in the government who has openly addressed the problem — Boris Pistorius, the popular defence minister.

He has argued that the absence of a long-term perspective makes it next to impossible for the Bundeswehr — and the arms manufacturers that supply it — to plan for the future.

Speaking to the Bundestag in late January, he said that defence required “a reliable, sustainable, and yes, a rising [military] budget”.

“The €100bn fund was an important first step,” he told MPs. “But we must start thinking today about how we want to adequately equip the Bundeswehr even after the fund has been fully spent.”

The appeals for more money have been backed up by an escalation in rhetoric that Pistorius himself admits is designed to “shake the Germans awake”. He said last month, for example, that Putin could attack a Nato member state “within five to eight years”. “We have a threat level in Europe the likes of which we haven’t seen in 30 years,” he told the newspaper Tagesspiegel.

Such fears are now being compounded by the spectre of a second Donald Trump presidency — and a new era of American isolationism that could presage. Last Saturday, Trump declared that his administration would “encourage” Russia to attack any Nato member that failed to spend enough on defence — a comment widely condemned in Germany. Scholz said any attack on Nato’s principle of collective defence was “irresponsible and dangerous and solely in Russia’s interests”.

In the past few years, Europe has committed to taking on a greater share of the burden of collective defence. But that commitment is predicated on German military spending remaining at its current record levels — and that might be a pious hope.

MPs from the three parties in Scholz’s coalition government dismiss the growing fears about the army’s long-term financing. They quote finance minister Christian Lindner, who assured the Bundestag’s defence committee in late January that the 2 per cent goal was safe.

“He said the finance ministry is starting to prepare for this in its medium-term financial planning,” says Marie-Agnes Strack-Zimmermann, chair of the Bundestag’s defence committee.

Rheinmetall CEO Armin Papperger, Chancellor Olaf Scholz and defence minister Boris Pistorius pose with Leopard 2 tanks in Unterluess. Germany gave 18 of the tanks to Ukraine © Fabian Bimmer/EPA-EFE/Shutterstock

And anyway, she adds, all three parties in the government, as well as the opposition Christian Democrats (CDU) and their Bavarian sister party, the CSU, were committed to the 2 per cent goal.

“The chancellor stands by it, as do the finance, foreign and defence ministers . . . and the CDU/CSU tell us they do too,” she says. “So regardless of who’s in power after the next election, everyone should feel responsible for implementing it.”

But privately, no one in power seems to know how the target can be reached — especially considering the tight constraints on the German budget. Germany is one of the few countries to have a curb on new borrowing inscribed in its constitution, the so-called debt brake.

With such a straitjacket, plugging the Bundeswehr’s funding gap could prove difficult. “Will we have to cut the welfare budget? Abolish the debt brake? Raise taxes?” asks one minister. “We’re putting off the decision — but something is going to have to give. The sums just don’t add up.”

Scholz’s Zeitenwende speech finally recognised a truth that had long been evident to Germany’s generals — that the country’s military capabilities were dangerously depleted.

At the end of the cold war, the Bundeswehr had a troop strength of half a million, making it one of Europe’s most formidable fighting forces. But between 1990 and 2019, manpower fell by 60 per cent.

Workers help build artillery pieces at a factory in Unterluess. Berlin’s lack of clarity on financing is a big drawback for arms manufacturers, who are reluctant to invest in new capacity without an assurance of future orders © Fabian Bimmer/Pool/Reuters

The army became a kind of orphaned child, starved of funds. Military hardware was either mothballed, sold off or scrapped. One study by the German Economic Institute (IW) found the army had been underfunded relative to Nato standards by at least €394bn between 1990 and the early 2020s.

Scholz called time on this era of parsimony. In late 2022, he boasted that Germany would soon have “the biggest conventional army” of all the European member states in Nato.

Pistorius has gone even further, saying in an interview last November that Germany must become “kriegstüchtig” — a word that means “ready to wage war and capable of doing so”. It drew howls of protest from the pacifist wing of his Social Democrat party.

The shift in rhetoric has been astonishing to some. “Five years ago, people would have called Pistorius crazy for using that word,” says Heusgen. “Now he’s Germany’s most popular politician.”

But some are still disappointed. “It’s the tragedy of the Zeitenwende transformation,” says Major, the defence analyst. “Despite all our efforts, it’s just not enough.”

Part of the problem is that despite all the new money, the Bundeswehr is in many ways even less well equipped than it was before the Russian invasion of Ukraine. Germany has given a lot of its best kit to Kyiv. And it is still not clear how and when the gaps will be filled again.

Lieutenant Colonel Sascha Bleibohm and Colonel Christian Guntsch sit inside a Sikorsky CH-53 at the Holzdorf base. The helicopters, in use since 1972, will be replaced by 60 new Chinooks © Jan Zappner/FT

For example, Germany donated 14 armoured howitzer 2000s, one of the most advanced systems of its kind in the world. But, under current contracts, only 10 of them will be replaced. A defence ministry spokesman said there was an option to buy 18 more for the army — “funding permitting”.

Meanwhile, plans to swap the five Mars II rocket artillery systems supplied to Ukraine for five Israeli-made “Puls” multiple rocket launchers are moving at a snail’s pace, with the Bundestag still to approve the purchase. It could also take years before the Bundeswehr gets replacements for the 18 Leopard 2 A6 battle tanks it gave to Kyiv.

A potentially larger problem, though, is the long-term funding issue. “We are starting a lot of procurement projects that won’t be completed by the time the €100bn has been used up,” says Johann Wadephul, the CDU’s spokesman on defence and foreign policy. “We’ll have paid for part of the F-35 fighter jets, part of the infantry fighting vehicles, part of the new ships, but not all. That’s why the financing must be continued.”

The lack of clarity on financing is a big drawback for arms manufacturers, who are reluctant to invest in new production capacity without an assurance of future orders. “Industry needs to know it has buyers — say a five or 10-year plan with guaranteed offtake,” says Strack-Zimmermann.

“That’s especially important for the Mittelstand [small and medium-sized enterprises] who need certainty when they’re hiring more people or increasing capacity,” she adds. “But right now there’s no long-term offtake capacity in the system.”

Military procurement also remains a problem. Scholz’s government has pushed through new measures to speed up and simplify procedures, for example by restricting the right of losing bidders to legally challenge the results of tenders. Pistorius boasts that 55 orders for military equipment priced at €25mn and above — a record number — were presented to the Bundestag defence committee last year. This year, he predicts, it will be even more.

A Sikorsky CH-53 at the Holzdorf base. The helicopters, which have been in use since 1972 and are so old that the army has struggled to find spare parts when they break down, will be replaced by 60 new Chinooks © Jan Zappner/FT

“We’re really stepping on the gas,” he told German TV last month.

But critics say the system is still too slow. “Don’t forget that a year after the Zeitenwende [speech], industry was saying that virtually no additional contracts had been signed,” says Ulrike Franke, senior policy fellow at the European Council on Foreign Relations. “Somehow, even now, we are still caught in this bureaucratic procurement nightmare.”

Meanwhile, Pistorius — who so far has the strong backing of the chancellor — is still encountering resistance in the system.

“Sometimes it seems like he’s tilting at windmills,” says Franke. “He asked for €10bn extra for the 2024 defence budget and got €1.7bn. The reality does not match the rhetoric.”

There is also a question mark over one of Germany’s most ambitious plans — the stationing of a 5,000-man brigade in Lithuania that will be the country’s first permanent foreign deployment since the second world war.

Experts say it is still unclear how it will be formed. Potential recruits have no sense yet of where their families will be accommodated, where their children will go to school or where their partners can work.

“You can’t fulfil your promise of sending an operational armoured brigade . . . to Lithuania without additional personnel and material,” Markus Grübel, a CDU MP, told Pistorius in a parliamentary debate last month. “The brigade is so far not backed up with sufficient money. This promise, too, risks being broken.”

That goes to the heart of one of Pistorius’ biggest challenges — personnel. Germany’s defence ministry plans to expand the army from 183,000 active servicemen and women to 203,000 by 2031. But that will be a gargantuan task, especially considering Germany’s ageing population and deepening shortage of skilled workers.

Even now, 20,000 vacancies must be filled every year as professional soldiers and voluntary conscripts leave the service or long-serving officers retire. Statistics show the number of applicants for jobs in the armed forces is declining.

A map of Bundeswehr Air Force Base Holzdorf, with the blue areas showing new buildings to house the Chinooks. The base’s runway is also being expanded, so any plane in the Nato arsenal can land there © Jan Zappner/FT

Yet calls on the Bundeswehr are only expected to grow. Last year, Germany offered to provide Nato with 30,000 troops and 85 aircraft and naval vessels within 30 days of any major conflict, under the alliance’s New Force Model. But finding enough people to fulfil that pledge will, according to Wadephul, be “extraordinarily difficult”. Meanwhile, Russia has shown throughout the Ukraine war that it can draw on vast — though not infinite — resources of manpower.

“We have to be honest: in terms of materiel and personnel, we are lagging behind,” he says.

Holzdorf provides a striking visual metaphor of the personnel shortage, and the scale of the task facing Germany’s military.

At one end of the 2.5km airstrip, a single construction worker, clad in bright orange overalls that mark him out against the dark-grey Brandenburg sky, toils with a shovel shifting hard earth into a pile.

Holzdorf’s commandant, Lieutenant Colonel Sascha Bleibohm, has no illusions about the challenges the federal government faces in reshaping Germany’s armed forces. But he is confident Berlin will stay the course.

“We see from the political side how much will there is to make this a success, I have to say,” he says. “That’s one thing the troops also all recognise.”

For Col Guntsch, the Zeitenwende means that “we are finally being put in a position to fulfil our mission — now but also in the future”. But his optimism is tinged with a warning: “Security does not come for free.”

Data visualisation by Ian Bott

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