Germany’s proposed budget for 2025 shows a 50% reduction in military aid to Ukraine compared to the current year.
The German government plans to allocate four billion euros in the 2025 budget for Ukraine, which represents only half of the €7.5 billion allocated in 2024. The decision is largely driven by Germany’s Finance Minister, Christian Lindner, a member of the liberal Free Democratic Party (FDP), who supports budget cuts due to the country’s limited fiscal flexibility under its constitutional debt brake, which restricts the federal deficit to 0.35% of GDP, except in emergencies. However, the German government has not classified its support for Ukraine in the conflict against Russia as an emergency situation. The coalition government finalised the budget proposal 16.8.2024, and it will now be reviewed by the German parliament. If the reduction of German support for Ukraine is approved, the ramifications could be significant. Without strong German support, Ukraine could once again face a shortage of weapons and ammunition, which would facilitate further advances by the Russian army and increase the loss of Ukrainian lives and territory. The Ukrainian military would instead need more intensive support from the West, as the Russian advance in the eastern regions of the country is slow and painful but continuous.
German Chancellor Olaf Scholz from the Social Democratic Party of Germany (SPD) defended Germany’s aid to Ukraine. He issued a statement responding to criticism over his government’s decision to cut funding as an instrument of a savings initiative. Scholz stressed that Germany remains a firm supporter of Ukraine and will continue its support for Kyiv, which has been protecting its territory against Russian aggression for more than two years. As a solution to Germany´s decrease in support for Ukraine, Olaf Scholz mentioned a possible use of frozen Russian assets, which are currently worth 300 billion USD. However, this possible solution is not currently available, and it is still unknown when it will be. He explained that all the partners that are supporting Ukraine are trying to find a way to use the Russian frozen assets, as this presents a technically challenging operation. The G7, representing the world’s seven largest economies, is exploring the potential of redirecting part of the $300 billion in frozen Russian assets to fund military support for Ukraine. In June 2024, the G7 reached an agreement to provide a $50 billion loan to Ukraine, using proceeds from frozen Russian assets as a source. This decision marks a significant financial commitment aimed at supporting Ukraine amidst its ongoing challenges.
However, various experts claim that using proceeds from frozen Russian assets will not offer a sustainable long-term solution for bolstering Ukraine’s defence against Russia, especially due to intricate legal and diplomatic hurdles that must be addressed. German politicians from the opposition Christian Democratic Union (CDU) criticised Scholz’s government for abandoning Ukraine. However, Germany currently remains Europe’s largest supporter of Ukraine in its ongoing war against Russia’s invasion. From February 2022 to the end of June 2024, Germany has committed more than €14 billion in assistance, primarily focused on military equipment and related support.
The decision to cut the budget for Ukraine could have severe consequences. Firstly, and most crucially, Ukraine could lose financial resources for equipment and weaponry for its fight against Russian aggression. Even today, stronger financial and material support would be needed to stop the Russian advances in Donbas and other Ukrainian regions. Also, without financial and material support from Germany, Ukraine will not be able to keep its operation in the Kursk region, putting pressure on Russian elites and gaining a potential bargaining tool for the future. However, even if Germany could find a way to keep its financial support for Ukraine at current levels, the decision to cut the budget for Ukraine could have other severe consequences. First, it could send a signal that Western aid to Ukraine is beginning to wane, which could prompt Moscow to escalate military pressure further. Germany is the EU´s primary economic player and second-largest supporter of Ukraine after the USA. Halving its support for Ukraine could undermine its reliability within the EU and in the trans-Atlantic community and endanger the collective efforts of Western partners to keep their support for Ukraine.
Therefore, Germany should reconsider its decision regarding support for Ukraine. In a situation where the continuation of US support after the presidential elections is more uncertain, Berlin’s support for Kyiv is more important than ever.