Europe Is Re-arming, and Its Defense Firms Stand to Profit

By Christoph Rauwald, William Wilkes and Tara Patel

28 Feb 2022 · 2 min read

Germany's pledge to massively ramp up military spending after years of restraint that's left significant parts of its armed forces with outdated equipment is set to boost Europe's defense industry and sent stocks higher.

Europe's largest economy will this year inject $113 billion (100 billion euros) into a special fund to modernize the army, Chancellor Olaf Scholz said Sunday in a speech to the lower house of parliament. From now on, Germany will hit a NATO target of allocating at least 2% of gross domestic product to defense, he told lawmakers in Berlin, a goal the country has consistently failed to meet.

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