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Read: German economy should benefit from arms investments!
Olaf Lies calls for Germany's economy to benefit from arms investments in order to secure combat capability and jobs.
Read: German economy should benefit from arms investments!
At a time when the security situation in Europe is characterized by major challenges, Lower Saxony's Prime Minister Olaf Lies speaks out. In a current appeal, he demands that the German economy must benefit from the billions in investments in armament and security. n-tv reports that Lies emphasizes the urgency of creating great value in Europe, with a focus on Germany. He is particularly concerned about cooperation with other federal states in order to find a “German solution” for the successor to the “Fuchs” armored transport vehicle.
In October, Lies and four other state leaders signed a letter to Chancellor Friedrich Merz to link a combat capabilities package for the Bundeswehr with an economic stimulus package. Hesse, North Rhine-Westphalia, Bavaria and Baden-Württemberg are also supporting this initiative. Boris Rhein, the Prime Minister of Hesse, is calling for an “arms offensive with a Germany guarantee for defense”. According to Lies, it is essential that a significant proportion of the orders are implemented in Germany, even if not all of the added value can be realized in every project.
Growth trajectory of the defense industry
A constant debate about the defense industry is triggered when the economic dimension is considered. Loud deutschland.de The German arms industry plays a central role in the security and defense capability of Germany, Europe and NATO. With around 105,000 jobs and a turnover of 31 billion euros, the trends show a significant increase in the coming years. The focus is primarily on smaller and medium-sized companies that are grouped around large “system houses” such as Rheinmetall and Airbus.
Rheinmetall, a leading company in the industry, recently announced that it would expand its location in Unterlüß with a new ammunition factory for around 300 million euros. Heckler & Koch, known for machine guns and grenade launchers, is also on the rise, hiring skilled workers and investing in expanding its capacities.
Impact of defense investments
In order to understand the context, the macroeconomic effects are also important. A study by EY shows that European NATO countries invest 72 billion euros in their defense sector every year. This spending supports 680,000 jobs and, if increased to 3 percent of GDP, could create an additional 660,000 jobs.
Such an increase in defense spending is expected regardless of the political framework and could massively boost economic development in Europe. The potential for new production capacity in the defense industry is also huge, and sales growth of 20 to 40 percent could be realistic for defense companies if spending continues to rise.
Prime Minister Lies emphasizes the importance that defense capabilities must be so high that war cannot even be considered. Is the view of the term “defensive” in contrast to “war-ready” as used by Defense Minister Boris Pistorius changing? One thing is clear: Lies is concerned about the changing security situation, especially with regard to Russia. The time for concrete decisions and the creation of a stable economic environment for the defense industry has now come.