The German Parliament finally approves amendments to the Constitution to rearm the country

The Bundesrat, the upper house of the German parliament, approved the massive rearmament and modernization plan Friday pushed by the future head of government, conservative Friedrich Merz.

The plan, worth several hundred billion dollars and which will require changes to the German constitution's strict debt limit rules, was approved by a two-thirds majority of 53 votes in the Bundesrat, which represents the country's regions.

The bill already got the green light from deputies in the Bundestag, the lower house, on Tuesday.

The plan, agreed upon with the Social Democrats, future allies of the conservatives in the next government, represents a revolution for Germany.

Germany seeks to be Europe's largest military power

During decades of budgetary orthodoxy, Germany neglected military spending, taking advantage of U.S. protection after World War II.

"We must do everything to bring Germany back to having one of the strongest armed forces in Europe and to be able to protect itself," Bavaria's conservative chief, Markus Söder, told the Bundesrat rostrum.

On Tuesday, Merz said the measures were a "first big step towards a new European defense community" that includes "countries that are not members of the European Union," such as the United Kingdom and Norway.

Specifically, Germany is will relax the "debt brake," which limits the country's borrowing capacity, as it relates to military expenditures and regions.

Added to that is a special fund outside the budget of just over $540 billion over 12 years to modernize infrastructure and reactivate Europe's leading economy, including some $100 billion earmarked for climate transition.

Impact of constitutional reform and new debt for Germany

The borrowing approved by the German parliament will be invested in the rearmament and modernization of its infrastructure.

According to a report from DW, the investment in infrastructure is going to have a direct impact, and Germany is estimated to grow by 1.5% by next year. Estimating the impact of defense spending is more complicated because much of the armament to be purchased will be outside Germany, for example from the United States.