The war in Ukraine has changed Europe within just three weeks, especially Germany. Since the end of the second world war, Germany has been opposed to a strong military and has tried to stay out of armed conflicts. That policy has ended with Russia bombing Ukraine in an illegitimate and illegal war, millions of refugees arriving at NATO’s borders, and Russia threatening European security.
Military Investments
The German government has announced a reset of the German security policy. It wants to provide a fund of 100 billion Euros immediately to ramp up Germany’s armed forces. Those are long overdue investments. The country’s forces are not in good condition, as they lack basic supplies and ammunition while tanks and airplanes don’t function.
Moreover, the government has committed to meeting its NATO commitments by investing at least 2% of its GDP in its armed forces every year. Germany’s NATO allies have long criticized Germany for not coming through on this commitment. Now the political reality has forced Germany to rethink its policies.
Energy Resilience
Economically, Germany must now increase its energy self-sufficiency. The country is heavily dependent on Russian oil and gas. It will now invest in renewable energy and LNG gas terminals. There is also a debate about reactivating nuclear power plants that were shut down during former chancellor Angela Merkel’s tenure. Improving energy resilience will be a key challenge that will unlock massive investments over the years ahead.
Refugee Crisis
Lastly, Europe is now faced with yet another refugee crisis. On the contrary to the past refugee crisis, Ukrainians are much closer to the German cultural realm, meaning it will be easier to integrate them than in previous refugee waves from Africa and the Arab world. Still, millions of refugees are a financial and social challenge that will require much efforts to solve.
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