In a significant move that underscores its continued support for Ukraine, Germany has recently announced the delivery of “mini-Taurus” drones. However, this commitment comes at a time when Europe’s largest economy faces unprecedented domestic challenges, putting its ability to maintain such support into question.
Recently, Germany has announced the delivery of 4,000 AI-guided drones, dubbed “mini-Taurus” by the local media, to Ukraine, highlighting their tactical advantages. However, it continues to withhold long-range Taurus missile systems. At the same time, experts are warning about the Ukraine war’s growing toll on the German economy, with the government’s unwavering support for Kyiv facing growing public scrutiny.
Germany has emerged as a major military supporter of Ukraine, providing an extensive array of advanced weaponry including Leopard battle tanks, Marder infantry fighting vehicles, Gepard self-propelled anti-aircraft tanks, Panzerhaubitze 2000 self-propelled howitzers, MARS II multiple rocket launchers, the IRIS-T SLM air defense system, Biber bridge-laying equipment, armored recovery vehicles, Stinger anti-aircraft missiles, Panzerfaust 3 anti-tank weapons, and drones.
So far, Germany has provided US$11.4 billion (£9 billion) in military aid to Ukraine but plans to reduce this to US$4.18 billion (€4 billion) by 2025. The Kiel Institute cautions that this decrease could mark a “significant fall” in overall assistance, exacerbated by the possibility of a reduced U.S. contribution when Donald Trump assumes power.
Germany’s ability to support Ukraine has come under pressure due to an unprecedented dual crisis marked by political instability and economic challenges.
Political Turbulence
Domestically, Germany faces a sharp political divide over its Ukraine policy, alongside mounting economic challenges.
The return of Republican Donald Trump to the White House has sparked concerns across Europe about a potential reduction in US support for Kyiv.
In Germany, political turmoil erupted shortly after Trump’s victory was confirmed. On November 6, Chancellor Olaf Scholz dismissed Finance Minister Christian Lindner, setting off a chain of resignations that ultimately dismantled the ruling coalition.
The country remains deeply divided over its support for Ukraine. This rift was a leading cause of Scholz’s government’s collapse, which necessitated early general elections. Now scheduled for February 23, these elections will occur as Germany faces a lame-duck government while Trump assumes office.
One key point of contention is the degree of support Germany should offer Ukraine. Opposition leader Friedrich Merz has promised that, if elected, he would provide Ukraine with long-range Taurus missiles and allow strikes on Russian soil. This approach sharply contrasts with Scholz’s stance of opposing such military aid to Ukraine.
Scholz’s handling of foreign policy has also come under fire. On 15th November, he held a one-hour call with Russian President Vladimir Putin, his first direct communication with the Russian leader in nearly two years.
Estonian Foreign Minister Margus Tsahkna criticized the call as a “strategic mistake” that weakened European unity in the face of Russia’s invasion of Ukraine and undermined Western efforts to isolate Putin.
Europe’s Largest Economy Faces Crisis
Germany’s upcoming general election will take place against the backdrop of a sluggish economy, with the European Commission forecasting a contraction in GDP for 2024.
According to its quarterly report, Germany, historically the economic engine of the European Union, is expected to be the weakest performer in 2025, with a meager growth of just 0.7% following a 0.1% decline this year.
A recent study commissioned by the Federation of German Industries (BDI), representing business lobby groups, reveals that one-fifth of Germany’s industrial output could be at risk by 2030. High energy costs and shrinking global markets for German goods are seen as the main threats.
The study concludes that the country must undergo “the biggest transformation since the postwar period,” with an estimated €1.4 trillion (US$1.5 trillion) in additional investments required by 2030. These funds would be directed toward infrastructure, innovation, education, and green technologies.
Germany’s economy shrank last year for the first time since the COVID-19 pandemic, and the outlook remains grim. This marks Germany’s weakest performance among major global economies.
The Growing Threat Of Deindustrialisation
Germany’s industrial decline is exacerbating the economic slowdown. According to the Bundesbank (Germany’s central bank), the German industry is under severe pressure to adapt to changing global conditions, and rising consumer prices due to higher inflation are expected to persist in the coming year.
The situation worsened when Volkswagen, Germany’s flagship automaker and largest industrial employer, announced the closure of three factories. This resulted in 20,000 job losses and a 10% reduction in salary costs for all employees, with pay freezes for the next two years. The company attributed the decision to competition from China, high energy costs, and a challenging economic environment.
Volkswagen’s decision to cut labor costs follows reports that it spends a higher proportion of its sales on labor costs compared to its competitors. This marks a significant turning point for Germany, a nation known for its industrial strength.
This marks a significant turning point for Germany, a nation known for its industrial strength. The specter of deindustrialization has loomed for years, exacerbated by Russia’s invasion of Ukraine, rising energy prices, and a slowing Chinese economy. Additionally, Chinese carmakers have been gaining ground on Volkswagen.
The reality of deindustrialization is now undeniable. On October 29, Martin Wansleben, head of the German Chamber of Trade and Industry, stated, “The signs of deindustrialization are becoming increasingly clear.”
Volkswagen’s closures were the final straw that led to the collapse of Germany’s government. The long-feared deindustrialization, driven by high-tech competition from China and the ongoing Ukraine conflict, has finally become a tangible reality for Germany’s political leaders.
Support To Ukraine
Last week, German Foreign Minister Annalena Baerbock issued a warning to supporters of Russian President Vladimir Putin, announcing that the European Union is preparing new sanctions against Iran and addressing concerns over Chinese drone support.
Meanwhile, the United States has made a key decision regarding its military support for Ukraine, allowing Kyiv to use its long-range missiles inside Russian territory. Before this, the six largest European countries—France, Germany, Italy, Poland, Britain, and Spain—expressed their willingness to shoulder the military and financial burden of aiding Ukraine if the US were to scale back its support.
Germany hopes that Ukraine can meet most of its military needs through the US$50 billion in loans secured from frozen Russian assets approved by the Group of Seven industrialized nations.
The Cost Of Solidarity?
Berlin’s traditional role as Europe’s economic powerhouse is under unprecedented strain, with many citizens expressing concern about the government’s focus on international issues at the expense of domestic welfare. The combination of political uncertainty, economic challenges, and international commitments presents a complex challenge for Germany’s future leadership.
- Shubhangi Palve is a defense and aerospace journalist. Before joining the EurAsian Times, she worked for ET Prime. In this capacity, she focused on covering defense strategies and the defense sector from a financial perspective. She offers over 15 years of extensive experience in the media industry, spanning print, electronic, and online domains.
- Contact the author at shubhapalve (at) gmail.com
