Mr Scholz met with Western leaders on Tuesday and stated the country has reached its limit on how many weapons it can send to help Ukraine’s troops from its own military reserves.
The German public radio station MDR aktull tweeted: “Scholz no longer sees any possibility of arms deliveries to Ukraine from Bundeswehr stocks.
“After a video conference with the allies of the EU, NATO and G7, the Chancellor said that the aim was to support the arms industry and NATO partners with deliveries”.
The German chancellor has been under growing pressure recently to authorise the delivery of heavy weapons to Ukraine.
The country has had a long-standing practice of blocking lethal weapons from being sent to conflict zones.
However, in February, Mr Scholz surprised even close partners when he announced an “epochal change” in German’s foreign policy to relax its stance on exporting weapons to Ukraine.
The decision was an abrupt change in course after Germany had initially said it would not send military assistance despite pressure from the EU and NATO members.
The country then announced it would increase its military spending to two percent of GDP, in line with the target for NATO members.
However, Chancellor Olaf Sholz is reportedly still shying away from sending heavy equipment, such as tanks to Ukraine.
“We have to finally start supplying Ukraine with what it needs, and that’s heavy weapons.
“I can only speculate why the chancellor is stepping on the brakes like this. I can see no logical reason for it.
“But with his actions, the chancellor is not only damaging the situation in Ukraine, but he is also massively damaging Germany’s reputation in Europe and the world.”
Germany has also failed to commit a full embargo on Russian oil and gas imports due to fears of how it would impact the economy.