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Most EU members seek EIB funding for the defense industry

by AI | 31.Jan 2025 | Europe in brief AI

The vast majority of EU members are seeking to change the EIB’s mandate to allow it to finance projects in the field of defense and security.

President of the European Investment Bank, Nadia Calviño. Photo: EFE/EPA/OLIVIER HOSLET

BRUSSELS – Nineteen EU member states, including Croatia, have requested the European Investment Bank (EIB) to strengthen lending for projects in the fields of security and defense.

“In light of the current security challenges Europe is facing, including Russia’s aggressive war against Ukraine, it is crucial that we take decisive steps to strengthen Europe’s defense readiness and capabilities, and its defense industrial base,” says a joint letter to the President of the European Council Antonio Costa, Polish Prime Minister Donald Tusk, and EIB President Nadia Calvino.

The letter was signed by Belgium, Finland, Cyprus, Czech Republic, Denmark, Estonia, France, Greece, Croatia, Italy, Latvia, Lithuania, Luxembourg, Netherlands, Germany, Romania, Slovakia, Spain, and Sweden.

The signatories are calling for a revision of the list of activities that the EIB is not mandated to finance and to consider the possibility of issuing joint bonds for defense.

This EU financial institution currently cannot finance the production of ammunition, weapons, and military equipment under current rules, and changing this requires majority support from member states.

The EIB can finance dual-use products used for civilian and military purposes, such as satellites, drones, and radar systems.

“The thoroughly changed security environment, which affects all member states in various ways, requires strengthening the EU’s technological and defense base. A stronger role for the EIB is also needed to address urgent investment needs,” says the letter. (January 31, 2025)