Within a few weeks, European Union Summits with the main theme of defense and security, the interventions of the European Commission, but also the meetings of the so-called "states of the willing" for the security of Ukraine, followed each other at a frantic pace, in an attempt to find the means and methods for the massive and rapid rearmament of the European Union.
The idea of the autonomy of the EU's defense is not new. In 2015, the former President of the European Commission, Jean-Claude Juncker, had publicly called for the creation of a European army, a proposal that was rejected by the EU member states.
Ten years later, the same idea returned to the European Council. More specifically last Thursday, March 20, when it was discussed by the 27 heads of state and government of the EU. They reached a common strategy for increasing defense capabilities over the next five years. The timing is not coincidental, since, in addition to the fact that several European intelligence agencies have warned of possible Russian aggression in one or more EU countries within three to five years, some European governments do not rule out the scenario of a partial or even total military withdrawal of the United States from the Old Continent.
The framework had already been presented by the European Commission with the so-called "White Paper" on the rearmament of Europe, with which the EU executive body hopes that up to 800 billion euros could be made available by 2030 for the purchase of protective equipment, most of which should be produced in the EU.
Where will the money be found?
The main points of the plan include a new fund called SAFE (Security Action for Europe), through which member states will have access to €150 billion that the Commission will borrow from the markets and then lend at a very low interest rate to member states. The reason is that the European Commission, which has a high credit rating (AAA), can borrow at much lower interest rates than many EU countries.
The deadline for submitting a loan application is June 30, 2027, and EU countries will have to repay them within 45 years. At the same time, the Commission allows EU member states to deviate from the rules of the Stability Pact to invest in defense up to 1.5% of their GDP each year, a percentage that will not be counted in the public deficit, something that with the most optimistic forecasts could mobilize up to 650 billion euros.
However, many in Brussels believe that the €800 billion target will never be reached. Some of the EU's largest and wealthiest member states with high credit ratings, such as Germany, which announced a €500 billion increase in defense spending, have no intention of taking on EU-backed loans, while some heavily indebted member states, mainly in southern Europe, have no intention of adding new financial burdens.
In an effort to boost the European defence industry and to please the EU’s largest defence producer, France, the Commission stipulates that 65% of joint defence procurements financed under SAFE must be produced by suppliers based in the EU, Norway or Ukraine. Although the loans will only be available to these countries, joint defence procurement will also include third countries. Specifically,
the member states of the European Economic Area (EEA/EFTA), namely Switzerland, Iceland and Liechtenstein, countries with which the EU has established a security and defence partnership, such as Moldova, South Korea, Japan, Albania and North Macedonia, as well as “accession countries, candidate countries and potential candidates”. And although the UK is currently out of the picture, Turkey, as a candidate country, could benefit, under certain conditions.
Turkey's role
According to the European Commission’s proposals, candidate countries can participate in joint procurement of defence equipment, but cannot receive loans through the SAFE mechanism. Turkey, as a candidate country, could theoretically get a share of the hundreds of billions of euros that will be allocated for defence over the next five years. The Commission’s “White Paper” has a special paragraph on its neighbour, which states, among other things, that “Turkey is a candidate country for EU membership” and a long-term partner in the field of the Common Security and Defence Policy. The EU will continue to engage constructively to develop a mutually beneficial partnership (UAVs) and anti-drone systems are extremely limited, which is a concern for member states such as Poland and Germany.
United Kingdom
The UK is not only the second nuclear power on the European continent, but also a country with strong defence industries that are already collaborating on many pan-European defence projects. European officials know that the production chains between the two sides are so complex and powerful that it would be extremely damaging to break them. British companies, such as defence giant BAE Systems, participate, among others, in the production of the Eurofighter Typhoon fighter jet, together with the European Airbus and the Italian Leonardo, which collaborates with the Turkish Baykar, while the same industry also participates in the Franco-Italian manufacturer of missile systems MBDA.
In this context, the United Kingdom is described in the Commission's "White Paper" as an "essential ally", while Brussels and London are racing against time to ensure that British companies participate in the rearmament of Europe. The head of European diplomacy, Kaia Kalas, will travel to London to prepare the ground for the European Union-United Kingdom Summit, which will take place next May with the main objective of signing the defense and security agreement that will open the door to the rearmament of the EU and British industries.
Made in Europe or...
Although one of the Commission's main proposals for EU member states and France's main desire is to buy "Made in Europe", the defense dependence of European countries on the US is great. The largest arms importer within the EU today is Poland, which buys 87% of its weapons systems from the United States and South Korea.
For the Netherlands, the second largest importer within the EU, or for Italy, the situation is even more spectacular. The United States accounts for 97% and 94% of their arms purchases respectively. Greece is an exception, as their largest supplier is France.
At the same time, the vast majority of EU countries, including Greece, use American-made Patriot anti-aircraft systems. Although Portugal became the first country to cancel the purchase of American F-35 fighter jets due to Donald Trump's policy, they remain the first arms exporter in the EU. Whether member states will buy "Made in Europe" weapons or continue to rely on the American defense industry remains to be seen in the coming weeks. (A2 Televizion)
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