Goldman Sachs: The new German government is expected to increase defense spending from 2.1% of GDP to 3%.

Goldman Sachs predicts that the new German government will increase defense spending from 2.1% of GDP in 2024 to 3% in 2027, and to around 3.5% by the end of this decade. Approximately half of the growth in defense spending can be used for military equipment, which will directly benefit the defense industry. Based on the historical split between imports and domestic production, the demand for German military equipment may increase GDP by 0.5%, roughly doubling the demand for the German defense industry.