EU prepares record €120 billion for defense: helping Ukraine will be a priority
30 July 2025 21:19
At least 17 European Union states have applied to the European Commission for more than €120 billion in cheap loans to strengthen their defense capabilities and purchase weapons, including to support Ukraine. This was reported by "Komersant Ukrainian" with reference to Politico and Reuters.
According to the media, the funds to support our country will be transferred under the Security Action for Europe (SAFE) mechanism, which is part of the broader ReArm Europe defense initiative (also known as Readiness 2030).
Security Action for Europe (SAFE) is a new financial mechanism of the European Union aimed at strengthening the defense capabilities of EU member states and supporting joint defense initiatives, including the supply of weapons to Ukraine. The support fund is modeled after the Marshall Plan, which was created to strengthen the EU’s defense sector, reduce dependence on the United States, and strengthen the defense industry.
SAFE allows EU countries to borrow on favorable terms: the repayment period is up to 45 years, and the interest rate is significantly lower than the market rate. This financing scheme is designed to ensure the long-term stability of defense budgets, reduce the financial burden on countries with high public debt, and accelerate the modernization of the armed forces.
The planned volume of support programs is up to €150 billion. The funds should help to develop the European defense industry, establish new production lines, create high-tech jobs, and diversify sources of weapons. In the context of global instability, the war in Ukraine, and strategic uncertainty about the United States, this decision looks like an attempt to strengthen European defense autonomy.
The largest application was submitted by Poland – for €45 billion. Belgium, Bulgaria, Cyprus, the Czech Republic, Estonia, Spain, Finland, Hungary, Latvia, Lithuania, as well as Greece and Italy, which plan to join the deadline, have also applied. Some countries see the funds raised as a tool for large-scale assistance to Ukraine, either by financing arms purchases directly or through joint programs.
The program includes the “buy European” principle, which obliges countries to spend at least 65% of their funds on defense products from the EU, EEA countries, or Ukraine. This is expected to boost domestic production and reduce dependence on third countries.
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