Germany to increase defence spending in response to 'Putin's war' - Scholz

FILE PHOTO: Germany's Finance Minister Olaf Sholz poses for a photo as finance ministers from across the G7 nations meet at Lancaster House in London, Britain June 5, 2021 ahead of the G7 leaders' summit. Alberto Pezzali/Pool via REUTERS

BERLIN (Reuters) -Chancellor Olaf Scholz said on Sunday Germany would sharply increase its spending on defence to more than 2% of its economic output in one of a series of policy shifts prompted by Russia's invasion of Ukraine.

Germany this week also halted its Nord Stream 2 gas pipeline project with Russia and agreed to send weapons to Ukraine after long resisting pressure from Western allies on both issues and facing accusations of being too dovish towards the Kremlin.