BERLIN, Nov. 28 (Xinhua) -- Germany's lower house of parliament, the Bundestag, on Friday approved the government's 2026 federal budget, paving the way for record public investment next year while projecting widening fiscal gaps over the following four years.

The budget sets federal expenditures for 2026 at 524.5 billion euros (607 billion U.S. dollars), slightly higher than the 520.5 billion euros proposed in July's draft. Most of the additional funds are earmarked for investment.

Since taking office in May, the federal government has placed public investment at the center of its strategy to revive Germany's sluggish economic momentum. Although optimism surrounding the stimulus has dimmed in recent months amid implementation delays, governing parties insist they still expect an economic improvement next year.

According to the core budget, 58.4 billion euros of next year's spending is allocated to public investment. Including additional expenditure financed through extra-budgetary sources - such as the Climate and Transformation Fund and the new infrastructure fund - total federal investment is expected to reach around 126.7 billion euros in 2026, marking the second consecutive record following an all-time high in 2025.

The medium-term fiscal plan foresees annual public investment of roughly 120 billion euros between 2027 and 2029.

Despite winning approval by a vote of 322 to 252, the budget drew criticism from opposition parties. The Greens called it the "largest budget ever," arguing that much of the spending goes toward fulfilling campaign promises rather than addressing urgent economic needs, including the modernization of Germany's aging infrastructure.

The Alternative for Germany (AfD) party said federal spending in 2026 should be cut to 505.8 billion euros and defense expenditures reduced to ensure a swift return to the old debt-brake rules. The party also warned that Germany faces mounting interest burdens in the coming years due to elevated debt levels.

According to the budget, interest payments are expected to reach 30 billion euros in both 2025 and 2026 before rising sharply to 66.5 billion euros by 2029. Cumulative fiscal gaps over the 2027-2029 period are projected to total 172 billion euros. Analysts cautioned that rising borrowing needs and expanding fiscal deficits could pose increasing risks to the long-term sustainability of Germany's public finances. (1 euro = 1.16 U.S. dollars) ■