EU's financial maneuver: Bolstering defence and aiding Ukraine
The European Commission wants to propose ways to finance EU defence and further support Ukraine. It plans to allocate up to 735 billion CAD for this purpose. Decisions will be made after the elections in Germany.
The European Union is preparing for significant investments in defence and support for Ukraine. In March, the European Commission will present financing proposals for these activities.
Decisions regarding financing depend on the outcome of the German elections. Berlin has so far opposed joint borrowing for defence purposes, but after the elections, a "European financial package" might be possible.
Brussels' plan to raise funds. There are several possibilities
Brussels is considering using 137 billion CAD from unused Recovery Fund loans.
The European Commission is also considering changes to the current EU budget. EC spokesperson Maciej Berestecki mentioned redirecting funds from the cohesion policy to defence. Investments could involve dual-use infrastructure.
The creation of an intergovernmental financial instrument for defence is also being considered. Minister Radosław Sikorski mentioned establishing a new rearmament bank modelled on the European Bank for Reconstruction and Development.
The head of the EC, Ursula von der Leyen, announced the easing of fiscal rules. This will allow EU countries to increase defence budgets without penalties for excessive deficits, a crucial step in the context of rising security expenditures.
