Germany updates: Merz condemns Russia, urges Gaza ceasefire

Ex-Chancellor Olaf Scholz is to receive a state-paid office with a staff of eight. Opposition parties say this is too much.

Read more here.

Germany has come under heavy criticism in a new World Health Organization (WHO) report for maintaining relatively low tobacco taxes compared to other European countries.

"Germany does everything with an efficient and expensive healthcare system to save lives. It is therefore astonishing that so many lives are put at risk by such lax tobacco control," said Rüdiger Krech, WHO director for health promotion, in comments to the German press agency DPA.

Globally, an estimated 1.3 billion people use tobacco, and about 8 million die each year from its consumption. The WHO recommends that taxes make up at least 75% of the retail price of tobacco products, calling it the most effective way to curb usage. Germany, however, averages a tax rate of just 61.4%. About 40 countries exceed the 75% threshold.

The report also finds Germany falling short in other areas of tobacco and nicotine control. The WHO criticizes Germany's support programs for quitting tobacco as insufficient and says advertising bans are not strict enough. Public smoking bans are deemed "entirely inadequate," with the WHO pointing out that 1.3 million people worldwide die from secondhand smoke exposure each year. The agency calls for more completely smoke-free environments.

German Chancellor Friedrich Merz has declared that Germany is once again a reliable global actor and promised it would show leadership through its alliances.

While he was opposition leader, conservative Merz accused his center-left predecessor, Olaf Scholz, of passivity in European policy.

The German leader was delivering a key foreign policy speech in parliament just hours before departing for a NATO summit in The Hague. Read more about the speech here.
 

A far-right German magazine has been allowed to continue publishing, after a top administrative court overturned a government-imposed ban.

The Federal Administrative Court in Leipzig confirmed its earlier ruling from August, declaring that former interior minister Nancy Faeser's ban on "Compact" magazine was unlawful.

Faeser had banned the publication in July 2024, calling it a "central mouthpiece of the right-wing extremist scene." The court suspended the ban shortly afterward, allowing the magazine to keep operating while the case proceeded.

Presiding judge Ingo Kraft said the decision was based on Germany's Basic Law, which "guarantees freedom of opinion and freedom of the press even to enemies of freedom." The court found that while Compact contained highly polemical content, it had not crossed into anti-constitutional behavior.

The court's ruling is final.

Editor-in-chief Jürgen Elsässer welcomed the outcome and said it would impact discussions around the far-right Alternative for Germany (AfD) party. He described Compact as "the assault gun of democracy" and argued that if the magazine could not be banned, "then banning the AfD would also be impossible."

The German government signed off on the country's draft budget for 2025 Tuesday, paving the way for a massive hike in government spending.

The expected budget hike was made possible by a law passed in March, easing Germany's so-called debt brake to allow spending on defense and infrastructure.

Lawmakers are expected to vote on the budget in September.

Friedrich Merz told parliament on Tuesday that "Iran must not have nuclear weapons."

"The Iranian leadership has been destabilizing the Middle East for decades," he told lawmakers. "The danger of their nuclear program is something that the International Atomic Energy Agency (IAEA) has referred to in an alarming report just a few days ago."

The chancellor's remarks were met by applause by some, but not from all lawmakers in Berlin.

In his address, Friedrich Merz condemned Russian airstrikes on Ukraine, adding Moscow does not want peace.

"Genuine, lasting peace requires a willingness for peace on all sides," Merz said on Tuesday in the Bundestag, Germany's lower house, ahead of his visit to The Hague for a NATO summit.

"Russia, on the other hand, has made it clear in a barbaric way with its new wave of attacks on the Ukrainian civilian population that it does not currently have this willingness for peace," the German chancellor said.

Kyiv has been hit by a flurry of attacks in recent weeks, with casualties mounting.

Ukraine has been fending off a full-scale Russia invasion since February 2022 but recent efforts to end the conflict have yet to yield a truce.

"Ukraine has agreed to an immediate ceasefire without any conditions. Russia has refused to accept this," Merz said in Berlin.

Chancellor Merz highlighted the role of Iran in the October 7 attacks in Israel.

In his parliament address he said: "Without Iran, the October 7, 2023 [attacks] in Israel would not have been possible."

"Hamas, Hezbollah and the Houthi rebels are terrorist organizations funded by Iran and equipped by Iran."

The Hamas-led attacks on southern Israel in October 2023 saw nearly 1,200 people killed, including hundreds at a music festival taking place in Re'im near the Israel-Gaza border. Militants also took around 250 hostages back to Gaza.

In the subsequent ongoing conflict in Gaza some 55,000 Palestinians have been killed since October 2023, according to the Gaza Health Ministry.

Hamas is designated a terrorist group by the EU, the US and other countries.

In his address to the German parliament on Tuesday, Chancellor Friedrich Merz said Israel has a right to defend itself, and reiterated Berlin's stance to the same effect.

"Israel has a right to defend its existence and the safety of its citizens," he said.

Iran wants to "annihilate" the state of Israel, he told lawmakers in Berlin.

"Our reason of state is to defend the state of Israel in its existence."

German Chancellor Friedrich Merz (CDU) is due to deliver a government statement in the Bundestag at noon (1000 GMT) on Tuesday regarding the wars in Ukraine and the Middle East, as well as NATO's 5% target.

The address is scheduled to last 25 minutes, followed by a 90-minute debate.

Germany's Cabinet approved on Tuesday the draft budget for 2025 and a framework for the following yearr, providing for record investments to boost growth.

After the Cabinet meeting, the 2025 budget is set to be introduced in the Bundestag, Germany's lower house of parliament. The final approval is due this September. 

The plans for 2026 are due to be agreed in full by the Cabinet in late July before a vote in the Bundestag by the end of the year.  

Senior citizens and families are shoplifting more frequently as the value of items shoplifted in Germany continues to rise, according to a study by the the Cologne-based retail research institute EHI published on Tuesday. 

In 2024, customers stole goods to the tune of approximately €2.95 billion ($3.4 billion), a 4.6% hike when compared to 2023.

The total loss has risen for the third time in a row and reached an all-time high.

"There are more and more people who can no longer afford or want to buy certain products, partly as a protest against the prices," said study author Frank Horst. 

"Senior citizens and families are also shoplifting more and more frequently."

Experts say the increase of self-service checkouts in Germany is correlated with the rise in shoplifting. More and more retailers, from supermarket giant Aldi to healthcare and cosmetics store chain dm, are adopting self-service checkout machines.

EHI surveyed 98 companies with a total of 17,433 shops regarding their inventory discrepancies to get their findings. 

Around 3,900 ultra-wealthy people in Germany now own more than a quarter of the country's financial wealth, according to a new report from management consultancy Boston Consulting Group (BCG).

The people with financial assets valued at more than $100 million (€86.17 million), now collectively have a total worth of just under $3 trillion.

BCG estimates Germany's total gross wealth in 2024 at $22.9 trillion. Of this, $11.8 trillion is invested in real estate and other tangible assets, while $11.1 trillion consists of purely financial assets such as bank deposits, securities, pensions and cash.  The ultra-wealthy own 27% of those financial assets. However, this is balanced against liabilities of $2.2 trillion, most of them loans.

Germany now ranks third worldwide in the number of ultra-wealthy individuals, behind the United States, with 33,000 super-rich, and China, with 9,200, the BCG found.

The management consultancy is headquartered in the US with offices in more than 50 countries.

Finance Minister Lars Klingbeil's draft budget has several record figures, including in terms of defense spending and government borrowing.

The defense budget is set to more than double by 2029, rising to €152.8 billion (roughly $177 billion). 

This means defense spending is due to rise to 3.5%, amid Germany's growing security fears since Russia's 2022 full-scale invasion of Ukraine as well as US President Donald Trump's growing pressure on Europe to up its defense spending.

Net borrowing will also significantly increase, as per the draft budget. It is due to jump to €81.8 billion in 2025, up from €33.3 billion last year. It will continue to rise in the next four years; to €89.3 billion in 2026, €87.5 billion in 2027, €115.7 billion in 2028 and €126.1 billion in 2029.

Those massive hikes are made possible by a law passed in March, easing Germany's so-called debt brake.

Germany has been operating with a provisional budget since the start of the year.

Germany will boost defense spending to 3.5% of gross domestic product by 2029, Reuters said on Monday, aiming to send a strong signal with its 2025 budget ahead of this week's NATO summit in The Hague.

Germany's total defense spending will go up from €95 billion in the draft budget for 2025 to €162 billion in the budget framework for 2029, according to Reuters.

Germany will be able to borrow a total €378.1 billion for defense between 2025 and 2029 thanks to debt brake reform from March (see below).