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As part of its rearmament plan Rearm Europe, the European Commission proposes to borrow 150 billion euros in the financial markets to help member states boost their defense budgets. With the European budget as a guarantee, it can obtain favorable long-term credits, but ultimately it is the member states that must repay the loans.
“For countries with a poor rating, it might be interesting to take out a loan, but it is nothing more than that,” observed De Wever. “Is that interesting for us? I don’t know. We still have to make decisions, but my first impression is rather no, that it is not interesting for Belgium to take out loans.”
De Wever added a personal reflection that the European corona recovery fund from 2020 demonstrated “how not to deal with money.” European leaders also decided then to borrow money at the European level and partially transfer it as subsidies to member states, but five years later there is still no agreement on new European revenues to repay these loans.
“If that agreement is not in place, it means that there will remain debts at the European level that will have to be financed with debts. Then Europe starts to look very much like our country, and I don’t know if Europeans are waiting for that. It also threatens to unleash centrifugal forces,” said the prime minister.
Rearm Europe also offers more flexible budgetary rules. President Ursula von der Leyen estimates that this could mobilize up to 650 billion euros in additional national defense expenditures. De Wever noted that this proposal also does not amount to “free money.” “It is an invitation to member states to spend more, but nothing more than that,” he said. “For countries with a large deficit like ours, a euro is a euro. Just because Europe is lenient doesn’t mean the deficit does not exist.”