The EU Commission has announced an ambitious defence package to boost Europe’s defence capabilities including the raising up to EUR 150 billion on the capital markets.
The measures aim to respond to the short-term urgency of supporting Ukraine, but also to address the pressing long-term need to boost Europe’s security and defence.
EU foreign policy chief Kaja Kallas admitted that for the past decades, Europe had not put a high enough price on defence. “We must spend more. At the same time, the value we add by working together is priceless. It gives us a competitive advantage that is unrivalled anywhere in the world. In our White Paper for European Defence – Readiness 2030, we set out concrete ways to do this.”
Europe was now ready to step up,” said Commission president Ursula von der Leyen: “We must invest in defence, strengthen our capabilities, and take a proactive approach to security. We are taking decisive action, presenting a roadmap for ‘Readiness 2030’, with increased defence spending, important investments in European defence industrial capabilities.”
ReArm Europe Plan/Readiness 2030 strengthens pan-European defence capabilities with new financial means, the White Paper frames a new approach to defence and identifies investment needs.
The White Paper for European Defence – Readiness 2030 responds to chronic under investment and a lack of efficient spending in Europe’s military capabilities. It presents solutions to close critical capability gaps and build a strong defence industrial base. It proposes ways for Member States to massively invest in defence, procure defence systems and build up the readiness of the European defence industry over the long run. Measures include:
- Closing capability gaps, with a focus on critical capabilities identified by Member States.
- Supporting the European defence industry through aggregated demand and increased collaborative procurement.
- Supporting Ukraine through increased military assistance and deeper integration of the European and Ukrainian defence industries.
- Deepening the EU-wide defence market including through simplifying regulations.
- Accelerating the transformation of defence through disruptive innovations such as AI and quantum technology.
- Enhancing European readiness for worst-case scenarios, by improving military mobility, stockpiling and strengthening external borders, notably the land border with Russia and Belarus.
- Strengthening partnership with like-minded countries around the world.
The ReArm Europe Plan/Readiness 2030 enables spending of over €800 billion. It allows Member States to activate the national escape clause of the Stability and Growth Pact, which will provide them additional budgetary space to increase their defence spending – up to a maximum of 1.5% of GDP – within the EU fiscal rules.
Raising up to €150 billion on the capital markets, the funds will be disbursed to interested Member States upon demand, on the basis of national plans.
The disbursements will take the form of competitively priced and attractively structured long-maturity loans, to be repaid by the beneficiary Member States. SAFE will allow Member States to immediately and massively scale up their defence investments through common procurement from the European defence industry – reducing costs for a strong European defence industrial base. Ukraine and EFTA/EEA countries will be able to join common procurements, and it will be possible for buy from their industries.
The ReArm Europe Plan/Readiness 2030 also relies on the European Investment Bank Group to widen the scope of its lending to defence and security projects, while safeguarding its financing capacity.
White Paper for European Defence – Readiness 2030
Communication on Accommodating increased defence expenditure
Regulation establishing the Security Action for Europe (SAFE)
Questions and answers on the White Paper for European Defence – Readiness 2030
Questions and answers on the ReArm Europe Plan/Readiness 2030
Factsheet on the White Paper for European Defence – Readiness 2030
