BERLIN, March 14 (Xinhua) -- Germany's CDU/CSU union and the Social Democratic Party (SPD) on Friday reached a compromise agreement with the Green Party on a major debt-financed package to boost infrastructure investment, climate protection, and national defense spending.

The financial package was previously proposed by the union and the SPD during their exploratory talks to form a new coalition government.

However, such a move requires an amendment to the constitutional debt brake policy, which requires the Greens' support to achieve a two-thirds majority in the Bundestag, the country's lower house of parliament.

A key element of the agreement is the allocation of 100 billion euros (109 billion U.S. dollars) from a 500 billion euro debt-financed infrastructure fund towards climate protection and the transition to a climate-friendly economy.

The proposal also aims to exempt the country's defense spending above 1 percent of gross domestic product (GDP) from the debt brake's limitations, paving the way for Germany to strengthen its defense capabilities.

The three parties managed to find consensus on key issues including defense spending, borrowing by the federal states, and climate protection funds, said Friedrich Merz, chairman of the Christian Democratic Union (CDU) at a press conference on Friday afternoon.

"We are capable of defense, and we are fully prepared to defend ourselves," Merz said. "Germany is back."

The package will be submitted to the Bundestag for approval next week. (1 euro = 1.09 U.S. dollar) Enditem

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