The CDU/CSU-SPD coalition is steering a roughly EUR 555 billion 2027 budget, centred on defence, infrastructure and state modernisation, through parliament with a vote due in November. The rise of the AfD and disputes over pension reform are straining the coalition.
What a Korean company can do now
Government · leader
Federal President Frank-Walter Steinmeier (Head of State); Chancellor Friedrich Merz, CDU (Head of Government)
Key national agenda
- Building up defence (core 2027 defence budget about EUR 109.7bn)
- Repairing bridges, roads and rail through the infrastructure and climate-neutrality special fund
- State modernisation: digital administration, less red tape, implementing the EU AI Act
- Restoring competitiveness with cheaper industrial power and grid-fee subsidies (2027-2029)
- Stabilising pension and health-insurance finances (including a sugary-drinks tax)
Government programmes
2027 federal budgetSpending about EUR 555.4bn
Net borrowing about EUR 118.7bn; including the special funds, new debt exceeds EUR 200bn. On 14 Oct the cabinet adopted its replies to the Bundesrat's comments
Infrastructure and climate-neutrality special fundEUR 500bn over 12 years
Investment in bridges, roads and rail; the opposition questions how much of it is genuinely additional
Defence budget increaseAbout EUR 109.7bn (2027)
The core 2027 defence budget rises by about a third on 2026, and the remaining Bundeswehr special fund is also drawn on
Federal grid-fee subsidy
Decided in Sep 2026; the industrial electricity price scheme has applied since May 2026
National action plan for climate-friendly shipping
Presented to and discussed by the cabinet on 14 Oct 2026
Business opportunities
AI tools and document-processing RPA for citizen services and reporting duties in local government
🔒 Why-now and buyers — analysis member ₩19,800/mo
AI video inspection and digital twins for bridges and rail assets
🔒 Why-now and buyers — analysis member ₩19,800/mo
Open this week
Energy monitoring and savings consulting for SME manufacturers
Energy-efficiency pressure persists even with the industrial power and grid-fee subsidies.
German Mittelstand manufacturers, local subsidiaries of Korean firms
Germany/EU market-entry consulting for Korean SMEs (certification, EU AI Act)
🔒 Why-now and buyers — analysis member ₩19,800/mo
Free members get a human-reviewed summary by email for up to 3 countries a month (sent within 24h). BUILD members get them all.
Korean support schemes
- KOTRA Frankfurt · KOTRA — Supports German market research and buyer sourcing, and ran a K-content showcase in July 2026.
- 2026 K-Content Experience Hall in Germany · KOTRA — Two-day Frankfurt event in July 2026 that helped Korean webtoon and character firms enter the European market.
- Export Voucher program · MSS / MOTIE — Covers costs for CE certification, overseas market research and consulting.
Official notices
The Federal Government (Die Bundesregierung)
- 2026-10-14 62nd cabinet session: sugary-drinks tax added to the 2027 Budget Accompanying Act, climate-friendly shipping plan discussed, 23rd amendment to the Foreign Trade Ordinance adopted
- 2026-10-14 Key points on child and youth media protection discussed; nursing structure commission established
- 2026-10-07 Cabinet adopted a bill toughening penalties for digital violence such as deepfakes
Disaster · conflict · epidemic
Stable 2026-11-07
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