Germany Forced to Borrow Half a Trillion Euros in 2026 0 9

The German government intends to issue debt securities amounting to approximately 512 billion euros in 2026, the Federal Financial Agency reported on Thursday.

The largest economy in the eurozone plans to raise 318 billion euros in the capital market and another 176 billion euros in the money market, with both amounts to be raised through auctions.

Berlin also plans to issue a total of four syndicated bonds and "green" bonds amounting to between 16 and 19 billion euros. Confirmation of the issuance plan for the second quarter of 2026 will be published in March.

In comparison, France plans to borrow 310 billion euros in financial markets in 2026, which is a record amount, according to a program published by the French Treasury Agency (AFT), which manages the national debt. France's national debt stands at 114% of GDP, compared to 63% in Germany.

Under the leadership of Friedrich Merz, German lawmakers approved a budget that included significant borrowing to revive the country's economy, modernize infrastructure, and finance military expenditures.

Strict rules enshrined in the constitution that limit borrowing have been relaxed to ensure tighter control over government spending. The German government will also launch a "Fund for Germany" to attract private investments of up to 130 billion euros.

After a year of stagnation in 2025, growth is expected to accelerate in 2026. According to the German Economic Institute, it is projected to reach 0.9% next year, particularly due to the introduction of two and a half additional working days compared to 2025.