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Investing.com -- Friedrich Merz, the prospective chancellor of Germany, is engaged in discussions with the Social Democrats (SPD) to expedite defense spending before finalizing a coalition agreement, according to Bloomberg News, citing sources familiar with the talks.
Merz, a member of the Christian Democrats, along with officials from the SPD, are exploring methods to bypass Germany’s stringent limitations on government borrowing. This move is intended to allocate resources for the enhancement of the country’s military infrastructure, which is currently in a state of disrepair. The sources, who chose to remain unidentified due to the private nature of these discussions, indicated that a vote might be pushed through the current parliament, which is nearing the end of its term.
Merz has publicly committed to increasing investments in the German military in an effort to counteract Russian aggression. However, his plans have encountered obstacles after smaller parties gained a blocking minority in the forthcoming Parliament. Without a two-thirds majority, the mainstream parties lack the necessary votes to relax the constitutional constraints on government borrowing. Nevertheless, they may circumvent this issue by initiating a vote prior to the first meeting of the new legislature on March 24.
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