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EU considers tapping €93bn in unspent Covid recovery funds for defence

Digest opened free editor

The European Union is studying 93 billion euros in the unexploited recovery funds in the defense sector as part of the efforts made to increase investment and military spending after the Trump administration warned that it would withdraw American security support from the continent.

The President of the European Commission, Ursula von der Lin, stated the option of financing at a meeting of the European People’s Party right on Tuesday, according to four people familiar with the discussion.

Additional financing needs for the bloc Defense It is estimated at 500 billion euros during the next decade.

Von der Lain said that the European Union can restore regional development funds, and stated “joint European financing” as another option to be explored, according to one of the persons familiar with the matter.

European officials were Discuss a plan In recent months to establish a government financing vehicle for defense, which is likely to be including the United Kingdom and Norway, instead of the European Union as a whole. This option would circumvent the veto (neutral or friendly transport fields “that do not support the use of common debts of defense.

European borrowing can also be more acceptable in capitals, including Berlin, where the possibility of another round of the European Union’s joint debts is very controversial, especially with the German federal elections on Sunday.

In the United Kingdom, there is a group of experts The “Re -Armed Bank” suggested Similar to the European Bank for Reconstruction and Development, as the participating governments will provide their capital – a proposed bowl of 100 billion euros – but it pays only 10 percent at the forefront. The bank will borrow the rest in capital markets, with the help of a strong credit rating.

In the absence of consensus on the borrowing of the fresh joint, it prompted the capitals of the European Union for commission To take advantage of all the money that is not in its control.

93 billion euros in the remaining borrowing capacity of its attachment after recovery and flexibility (RRF) represents unexploited funds from a total of 800 billion euros in grants and loans agreed upon by the European Union to collect their economies after the Women. Several capitals, including Berlin, approved the post -guardian box provided that the joint borrowing is once.

A spokesman for the committee said that clicking on the unused RRF financing would require changes to the fund’s bases, which must be supported by most of the European Union and European Parliament.

The remaining funds, which will be spent as loans, can be used to invest in research and development projects, as well as for investments in the so -called double use infrastructure such as airports, which have civil and military applications.

Another option that the committee explores Return alleged cohesion boxes Which is allocated to the least developed European Union regions.

“Based on the new approach, in addition to dual investments, the policy of cohesion can now support the defense sector, and its dealings to a large extent like any other industry,” according to a memorandum issued by the administration of the regional funds of the committee, financial times.

“Investments in Research and Development aims directly to develop new technologies for the army or.. Investments enhance defense production capabilities will now be eligible to contribute to regional development.

The European Union countries will also be allowed to increase national defense budgets without incurring sanctions under the financial rules of the mass. Von the Leyen Annonted At the Munich Security Conference during the weekend.

A Von Der Leyen spokesman immediately responded to a request for comment.

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2025-02-19 12:07:00

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