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Tuesday, September 17, 2024

“It's over. The coffers are empty.” Germany cuts military aid to Ukraine

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In the current and future German budget there are no new funds for aid for Ukraine, the portal of the daily “FAZ” reported. The reason is the spending cuts ordered by the Chancellor's Office and the Ministry of Finance.

“Most of the previously approved equipment will be delivered, but additional requests submitted by the Defense Ministry, on the recommendation of Chancellor Olaf Scholz, are to be rejected,” wrote Peter Carstens and Konrad Schuller in an article published Saturday in the online edition of the Frankfurter Allgemeine Zeitung.

The authors referred to a letter from Finance Minister Christian Lindner addressed on August 5 to Defense Minister Boris Pistorius.

The ban is already in effect. Next year the situation Ukraine will deteriorate further, as planned military aid is to be reduced by almost half, and in 2027 it will fall to less than one tenth of the current total – we read in “FAZ”.

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Funds not from the budget, but from frozen assets

Lindner's letter shows that the Ministry of Finance does not foresee a sudden interruption of aid for Ukraine. However, the funds are not to come from the German budget, but from the frozen assets of Russian banks. The authors recalled that Russian resources are estimated at $300 billion. As the G-7 countries decided, the interest on this amount is to finance a $50 billion loan for Ukraine.

Christian Lindner has been Finance Minister since 2021 (archive recordings)Reuters Archive

The journalists of “FAZ” assessed that the use of Russian funds is “uncertain and legally controversial”. “It is more than doubtful whether it will be possible to use Russian money in the future,” wrote Carstens and Schuller.

The effects of the ban on new spending are already visible. It was not possible to find money to finance the purchase of the IRIS-T air defense system, which the manufacturer – Diehl Defense – offered to Ukraine.

“It's over. The cash register is empty”

The editorial team explained that all funds (around eight billion euros) allocated for military aid to Ukraine this year have already been planned, and the upper limit of expenditure for next year (four billion euros) has also already been exhausted, and with a surplus.

“No new spending is possible,” the authors conclude. Only three billion euros have been earmarked for 2026, and only half a billion euros for 2027 and 2028. “That's it. The coffers are empty,” FAZ quoted an anonymous government official as saying.

As the portal wrote, both in the government coalition and in the opposition CDU and CSU, critical voices can be heard regarding the government's decision. CDU MP Ingo Gaedechens accused the chancellor of “duplicity”. Scholz promises military support to Ukraine, and at the same time wants to be the “chancellor of peace”.

Participants of the conference on the reconstruction of Ukraine: Volodymyr Zelensky, Olaf Scholz and Ursula von der Leyen (photo from June 2024)CLEMENS BILAN/PAP/EPA

Deputy SPD Andreas Schwarz pointed out that the reduction in German aid puts Ukraine in a difficult situation. The President Russia Vladimir Putin may perceive this as an announcement of withdrawal German support for Ukraine, and this will make it more difficult to resolve the conflict diplomatically. “If Ukraine loses the war, up to 15 million refugees could leave the country. How many of them will come to Germany?” Schwarz wondered.

Main image source: CLEMENS BILAN/PAP/EPA



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