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European Countries Seek EU Loans to Strengthen Their Military and Support Ukraine’s Defence
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![Photo of Cyril Barabaltchouk]( "Photo of Cyril Barabaltchouk")
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European governments are set to request billions of euros in loans from the European Union to strengthen their defense capabilities and support Ukraine’s defense against Russia.
This comes just ahead of Tuesday’s deadline for countries to apply for the new $173 billion Security Assistance Facility for Europe (SAFE) scheme, which was introduced as part of the EU’s broader ReArm Europe initiative, as was reported on July 29.
The program aims to reduce the EU’s reliance on US military support and boost Europe’s own defense industry, as well as to provide vital support to Ukraine as it continues to defend itself against Russia’s full-scale invasion, Politico reports.
Countries such as Belgium, Bulgaria, Cyprus, Czech Republic, Estonia, Spain, Finland, Hungary, and Lithuania have all expressed formal interest in securing loans under the scheme, with several others, including Latvia, Greece, and the Czech Republic, signaling their intention to apply by the midnight deadline.
The SAFE program allows nations to jointly procure weapons at a lower cost than purchasing them individually, a move expected to help Ukraine’s war efforts, since the joint purchases are intended to deliver armaments directly to the Ukrainian Armed Forces, not only supporting Ukrainian defense, but also strengthening the military stockpiles of European nations.
However, some EU countries, including Germany, Sweden, and the Netherlands, are expected to pass on the opportunity, as they have different approaches to funding and defense strategies. Despite this, countries participating in the scheme will still benefit from joint procurements, helping reduce the costs of arms deliveries to Ukraine, Politico claims.
Greek Prime Minister Kyriakos Mitsotakis confirmed that his country plans to request $1.3 billion in loans under the scheme, while other countries are exploring direct arms purchases from Ukrainian manufacturers, a move encouraged by the EU. This initiative is expected to increase the scale of Ukrainian domestic defense production, helping Kyiv to better integrate its technology with that of the EU.
EU Defense Commissioner Andrius Kubilius has emphasized that at least 20 EU countries are expected to demand up to $115 billion under the SAFE scheme, with the final figure to be determined after the application deadline.
Brussels has indicated that countries submitting applications after the deadline will still be considered, and that the funds will be provided through EU-level debt, taking advantage of the bloc’s triple-A credit rating.
While the program has garnered significant interest, some EU countries with high debt and deficits, such as Austria and Italy, remain hesitant to participate. However, countries like France and Belgium, despite facing budgetary challenges, are likely to take advantage of the low-interest loans, with Belgium aiming to secure between $8 billion and $12 billion, according to Politico.
The loans, with a 45-year repayment term and advance payments of up to 15%, are expected to play a big role in strengthening Ukraine’s defense capabilities, as well as boosting the EU’s collective security and military independence in the long term.
Earlier, it was reported that the European Union is also drawing up a $19.66 billion plan to overhaul its road, rail, and bridge networks to cut the time it would take to move tanks, troops, and military equipment across the continent in the event of war with Russia, said EU Transport Commissioner Apostolos Tzitzikostas.
