Germany Approves Nearly $1 Billion in Arms Exports to Israel in First Half of 2026

Germany has approved nearly 800 million euros (approximately $930 million) in arms and military equipment exports to Israel in the first six months of 2026, a significant increase compared to the 260 million euros approved for the entirety of 2025. This surge is partly attributed to Chancellor Friedrich Merz's partial lifting of restrictions on German arms supplies to Israel in November of the previous year. The second quarter of 2026 saw a particularly sharp rise, with approvals totaling 735.8 million euros, representing 91.9% of the first-half total. Of this amount, 67% was designated for a "naval project," and 21% for joint German-Israeli projects benefiting the German Bundeswehr.

According to Globes, the naval project involves the Israeli "Drakon" submarine, the largest submarine built in Germany since World War II. The sixth submarine of this class was recently transferred to Israel from the TKMS shipyard in Kiel. Israel's submarine fleet is entirely dependent on Germany and ThyssenKrupp, a reliance expected to continue for the next decade. However, Israel is increasingly developing its own surface fleet, with the Ministry of Defense recently contracting Israel Shipyards for five new "Reshef" class missile ships, valued at $840 million.

The "Drakon" submarine project experienced delays and increased costs due to significant design modifications after its development was halted in 2018. Each submarine takes approximately three years for design and planning, followed by seven years for construction. The latest three Israeli submarines, "Tanin," "Rahav," and "Drakon," are equipped with an Air Independent Propulsion (AIP) system, enabling extended submerged operations. International media reports indicate the "Drakon" exceeds 70 meters in length and displaces over 2,000 tons, making it the largest and most powerful submarine in the Middle East. "Tanin" and "Rahav" can reportedly reach speeds of 25 knots.

Looking ahead, Israel is set to receive three more "Dakar" class submarines from 2031 onwards, replacing older "Dolphin" class vessels. The contract with ThyssenKrupp, signed in 2022 and valued at approximately 3 billion euros, includes a 20% German financing contribution. The current export figures represent a record high, surpassing a previous surge in 2023 when Germany approved 327 million euros in exports, a tenfold increase from 2022. In contrast, German arms exports to Israel in 2024 amounted to 161.1 million euros.

Concurrently, Israel is a significant supplier of defense products to Germany. Following a deal for the "Arrow 3" missile defense system, Germany has become the second-largest customer for Israeli weaponry. Between 2021 and 2025, Germany accounted for approximately 21% of Israel's defense exports, trailing India (29%) and ahead of the United States (7.8%), according to the Stockholm International Peace Research Institute (SIPRI).