Berlin Boosts Defense Technology Sector with New Ecosystem and Increased Investment

Berlin is significantly ramping up its efforts to expand the city's defense technology sector by attracting more high-tech companies and securing a greater share of the federal defense budget. The Berlin Senate approved the Defense Technology ecosystem (DefTech) initiative aimed at fostering growth and collaboration within the military and security infrastructure businesses. Although no new funding was allocated, officials highlight that Berlin’s existing support options remain strong, with planned collaboration alongside Investitionsbank Berlin to provide sustained advisory services to defense companies.

Investment in Berlin's DefTech startups has surged remarkably, increasing from 287 million euros in 2023 to 889 million euros in 2025. The Berlin defense industry comprises around 130 companies that employ approximately 26,000 people and generate annual revenues of about 8 billion euros. Some firms like Rheinmetall have adapted to defense needs by shifting production from automotive parts to ammunition components.

Berlin’s governing mayor, Kai Wegner, stressed the city's intent to tap into economic growth and avoid Bavaria's dominant claim on federal defense funding. To enhance communication with the federal government and European Union, Berlin will establish a dedicated office at the Red City Hall. The initiative also leverages Berlin’s strong research landscape and proximity to government institutions to attract emerging DefTech startups. Economy Senator Franziska Giffey clarified that Berlin does not aim to become a weapons manufacturing hub but rather a center for developing innovative technical solutions in defense.

Together, these efforts are designed to create a comprehensive network integrating new and existing defense technology enterprises, bolstering Berlin’s strategic position in Germany’s national defense and security industry.