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Merz secures billion-euro deal for German military and infrastructure

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Merz secures billion-euro deal for German military and infrastructure
This article was originally published in German

A provision would exempt defence spending above 1% of GDP from debt brake rules, enabling Germany to increase military spending without limit.

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CDU leader Friedrich Merz has revealed plans for a new €500 billion special fund aimed at boosting infrastructure and defence spending.

Just over a week after his victory in the federal elections, Merz announced that his Christian Democratic Union (CDU), together with its Bavarian sister party (CSU) and likely coalition partner, the Social Democrats (SPD), will present a joint bill in parliament next week to ease the country’s debt brake.

“I want to say that very clearly in view of the threats to our freedom and peace on our continent, our defence must now apply ‘Whatever it takes’,” said Merz, speaking alongside SPD and CSU party leaders at a press conference in Berlin on Tuesday.

“The additional spending on defence can only be coped with if our economy returns to stable growth within a very short period of time . . . This requires rapid and sustainable investments in our infrastructure,” he added.

Amendment to ‘Basic Law’

The bills need a two-thirds majority in parliament to pass, meaning Merz must reconvene the outgoing Bundestag, elected in 2021, and gain the backing of the Greens.

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It marks a significant shift from Germany’s historically conservative approach to public borrowing. In 2009, Berlin enshrined the debt brake in its constitution, which restricts government borrowing and sets the structural deficit at a maximum of 0.35% of GDP.

Although Merz did not indicate such a move during the election campaign, the CDU/CSU is now defending the decision in light of recent global political events, including the tense clash between US President Donald Trump and Ukrainian President Volodymyr Zelenskyy in Washington.

“Germany and Europe must quickly strengthen their defence capabilities. The CDU, CSU and SPD will table a motion to amend the Basic Law so that defence spending above 1% of GDP is exempt from the debt brake,” Merz stated at the press conference.

SPD leader Lars Klingbeil emphasised that investments would not only be made in the German armed forces but also in a substantial funding programme for schools, day care centres, and infrastructure.

“This country has been running on empty in many areas, but that is now a thing of the past,” Klingbeil said.

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Response to the deal announcement

The Greens’ Parliamentary group leader, Katharina Dröge, has criticised Merz for failing to engage in dialogue with the her party before making the announcement, noting that the CDU/CSU could discussed their plans with the Greens in advance to secure the majority needed to pass the special fund in the newly elected Bundestag.

Merz has also faced some criticism for failing to outline his fiscal plans during his federal election campaign.

“Defence is largely exempt from the debt brake, with an additional €500 billion allocated for special infrastructure projects, plus further debt in state budgets! This is a matter of state policy,” says Robin Alexander, the deputy editor-in-chief of German newspaper WELT.

“However, it’s also true that this aligns more with what Scholz and Habeck proposed during the election campaign than with the approach that Merz campaigned on during the Bundestag election,” he adds.

Markus Feldenkirchen, a journalist for German newspaper Spiegel, made similar comments on the plan stating “the agreement between the CDU/CSU and SPD on the future financing of politics is responsible. What the future chancellor’s party proposed about financing during the election campaign was completely irresponsible. It was clearly a deliberate deception.”

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Pakistan calls troops, orders 3-day curfew as 24 killed in pro-Iran rallies

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Pakistan calls troops, orders 3-day curfew as 24 killed in pro-Iran rallies

Army deployed and some areas in northern Gilgit-Baltistan region put under curfew after deadly violence over Khamenei’s killing.

Pakistan has called in the military and imposed a three-day curfew in some areas following deadly protests over the killing of Iran’s Supreme Leader Ayatollah Ali Khamenei in a joint United States-Israeli attack on Saturday.

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At least 24 people were killed and dozens injured in clashes between protesters and security forces across the country on Sunday, prompting authorities to tighten security around the US embassy and consulates.

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The curfew was imposed before dawn Monday in the districts of Gilgit, Skurdu, and Shigar in the northern Gilgit-Baltistan region, where at least 12 protesters and one security officer were killed and dozens of others wounded during confrontations, according to an official statement.

Of those, seven were killed in Gilgit, a rescue official said, while six others died in Skardu, a doctor told AFP news agency on Monday.

Thousands of demonstrators on Sunday attacked the offices of the United Nations Military Observer Group in India and Pakistan (UNMOGIP), which monitors the ceasefire along the disputed Himalayan region of Kashmir, and the UN Development Programme in Skardu city.

Protesters also burned a police station and damaged a school and the offices of a local charity in Gilgit, according to officials.

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UN spokesman Stephane Dujarric on Monday said protesters became violent near the UNMOGIP Field Station, which was vandalised.

“The safety and security of UN personnel and premises throughout the region remain our top priority, and we continue to closely monitor the situation,” Dujarric said.

Shabir Mir, a Gilgit-Baltistan government spokesman, said the situation was under control and that the curfew would remain in place until Wednesday. Police chief Akbar Nasir Khan urged residents to stay indoors, citing “deteriorating law and order conditions”.

In the southern port city of Karachi, the country’s commercial hub, 10 people were killed and more than 60 injured during a protest outside the US consulate.

Two additional protesters were killed in the capital, Islamabad, while heading towards the US embassy.

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Pakistani authorities have beefed up security at US diplomatic missions across the country, including around the US consulate building in Peshawar, to avoid any further violence.

The US embassy and its consulates in Karachi and Lahore cancelled visa appointments and American Citizen Services on Monday, citing security concerns.

The federal government warned that the situation could further deteriorate amid large-scale demonstrations condemning Khamenei’s killing on Saturday.

Tehran has responded with a series of drone and missile attacks targeting Israel and US assets in several Gulf countries.

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Investors brace for a bigger backlash from Middle East war

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Investors brace for a bigger backlash from Middle East war
From being just a fringe risk, conflict in the Middle East has become a top worry for investors unsettled by the prospect of a power struggle in Iran and a protracted regional war, with ramifications for everything from global trade to inflation.
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Tel Aviv analyst shelters from 30 missile sirens in 48 hours, says Iran ‘won’t recover’

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Tel Aviv analyst shelters from 30 missile sirens in 48 hours, says Iran ‘won’t recover’

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The past 48 hours in Tel Aviv have been unlike anything seen before, a leading security analyst has said, as sirens blared amid missile threats following Operation Epic Fury and U.S.-Israeli strikes in Iran.

“We are facing a biblical event — nothing less,” Kobi Michael, a senior researcher at the Institute for National Security Studies and the Misgav Institute, told Fox News Digital, speaking from his shelter in the city.

Like many Israelis, Michael said he had spent hours in reinforced rooms during the ongoing barrage, adding that he was “very experienced in this.”

“But this all requires time and determination, and I do hope that Trump will also have them both,” he said, speaking shortly after the president released a video message stating that the military operation would continue “until all of our objectives are achieved.”

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Explosions from projectile interceptions by Israel’s Iron Dome missile defence system over Tel Aviv. (JACK GUEZ / AFP via Getty Images)

“Trump is the only one who can make the change — and that change will impact the entire region and the international order for years to come,” Michael added.

As of Sunday, Tel Aviv remained under a state of emergency following Iranian missile attacks that caused casualties and widespread damage.

According to The Associated Press, Iranian missile and drone strikes have killed approximately 11 Israeli civilians and wounded dozens more in retaliation for the U.S.-Israel strikes on Iran.

Shrapnel from missile impacts damaged at least 40 buildings in Tel Aviv, and authorities reported at least one death in the area from falling debris.

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The Philippine Embassy in Israel confirmed the death of a Filipino national after a missile strike hit Tel Aviv on Saturday.

TOMAHAWKS, B-2 STEALTH BOMBERS AND ATTACK DRONES POUND OVER 1,000 IRANIAN TARGETS IN 24-HOUR BLITZ

People take shelter as Iran launched missiles and drones towards Israel following the US-Israeli attacks. ( Mostafa Alkharouf/Anadolu via Getty Images)

“We enter our shelter once the siren is heard and stay there until the Home Front Command announces that we can leave,” Michael said.

“Usually, it is about 20 to 30 minutes — unless there are further sirens during our stay. Since yesterday morning, it has happened around 30 times.”

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Israel’s President Isaac Herzog also visited an impact site in Tel Aviv Sunday, delivering a message of resilience.

“The people of Israel and the people of Iran can live in peace. The region can live in peace. But what undermines peace time and again is terror instigated by this Iranian regime,” Herzog said.

EXILED IRANIAN CROWN PRINCE SAYS US STRIKES MARK ‘BEGINNING OF THE VERY END’ FOR REGIME

Israeli emergency service officer walks past building debris at the scene of a Iranian missile attack. (Ahmad GHARABLI / AFP via Getty Images)

Following the reported killing of Iran’s Supreme Leader Ayatollah Ali Khamenei and roughly 40 senior Iranian officials, Iran formed a provisional leadership council.

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Iran named Ayatollah Alireza Arafi, President Masoud Pezeshkian and Judiciary Chief Gholam-Hossein Mohseni-Eje’i to lead roles.

“The Supreme Leader did not complete the necessary groundwork regarding his own succession,” Michael added.

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“Pezeshkian will face very troubling challenges due to their heavy losses, severe disruptions to control and command systems, and the massive bombing and attacks across Iran, including Tehran,” he said.

“Even if this regime doesn’t collapse, it will never be able to reconstitute itself, recover or return to its previous position,” Michael added.

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