Friedrich Merz’s €1tn spending plan wins final approval from Germany’s upper house

The Financial Times highlights Friedrich Merz’s success in passing a sweeping constitutional amendment just before parliament’s term ends. The plan lifts debt limits for defence and creates a €500bn infrastructure fund, securing broad but fragile support from across the political spectrum. While welcomed abroad, the move marks a sharp U-turn for Merz, who had opposed relaxing fiscal rules. HEC Paris professor Armin Steinbach notes that Merz must now claim political “trophies” in upcoming coalition talks to balance the SPD’s major policy win.