BERLIN - Germany's new Chancellor Friedrich Merz pledged to make national security and economic revitalization top priorities in his inaugural address before the Bundestag on Wednesday.

Delivering his first major speech as Chancellor in the lower house of parliament, Merz outlined the policy agenda of his coalition government, formed by the Christian Democratic Union/Christian Social Union (CDU/CSU) and the Social Democratic Party (SPD).

During the speech, he declared the strengthening of the Bundeswehr - Germany's armed forces - a top priority. He committed to providing the necessary resources for it to become the most powerful military force in Europe.

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As part of the coalition agreement between the CDU/CSU and the SPD, the parties have decided to exempt defense spending exceeding 1 percent of GDP from the constitutional debt brake, allowing for more flexible funding of military needs.

Turning to the economy, Merz acknowledged that Germany is currently in recession. He identified excessive bureaucracy, high energy costs, and a burdensome tax regime as key obstacles to growth.

To counter these challenges, he pledged a return to economic expansion through investment and structural reforms. The focus, he said, would be on boosting competitiveness and safeguarding jobs.

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The coalition also agreed to establish a 500-billion-euro ($560 billion) fund aimed at supporting infrastructure development and climate initiatives.

Merz further underscored the importance of attracting private investment while maintaining a prudent stance on public debt.