Germany’s coalition government has agreed to reduce its 2025 budget deficit target from €17 billion to €12 billion. This compromise follows initial budget proposals that failed to align. Although Finance Minister Christian Lindner had hoped for a single-digit deficit, he acknowledged the new target as a necessary step.
The government plans to invest €4.5 billion in Deutsche Bahn’s infrastructure division and provide an additional €3 billion loan to support rail infrastructure. The total investment for rail infrastructure in 2025 will be €15.1 billion.
The measures, including the equity injection and loan, do not count towards the debt brake, ensuring compliance with Germany’s constitutional borrowing limits.