The European Union has proposed loosening its spending rules so that member countries can make bigger investments in defense.
The proposal by Ursula von der Leyen, the head of the European Commission, came amid calls by Donald Trump’s new U.S. administration for Europe to up its military spending in the face of the threat from Russia.
Von der Leyen said on Friday that amending an agreement on national debt would allow EU states to “substantially increase their defense expenditure.”
The proposed changes relate specifically to the EU-wide Stability and Growth Pact, which sets limits on countries’ budget deficits and their debt-to-GDP ratio, Euronews reported.
Von der Leyen intends to initiate the pact’s ‘escape clause’ for defense investment, meaning that swathes of military infrastructure spending could be exempt from wider budgetary rules.
Several member states, including Poland, had called for these rules to be loosened, reports said.
Von der Leyen said on Friday that amending an agreement on national debt would allow EU states to “substantially increase their defense expenditure.”
The proposed changes relate specifically to the EU-wide Stability and Growth Pact, which sets limits on countries’ budget deficits and their debt-to-GDP ratio, Euronews reported.
Von der Leyen intends to initiate the pact’s ‘escape clause’ for defense investment, meaning that swathes of military infrastructure spending could be exempt from wider budgetary rules.
Several member states, including Poland, had called for these rules to be loosened, reports said.
‘Another period of crisis’
Speaking at the Munich Security Conference, Von der Leyen said that the fiscal pact’s escape clause has been activated in the past to allow for more public spending in extraordinary situations.
“I believe we are in another period of crisis, which warrants a similar approach,” she said.
“This is why I can announce that I will propose to activate the escape clause for defense investments. This will allow member states to substantially increase their defense expenditure.
“Of course, we’ll have to do this in a controlled and conditional way, and I will also propose a wider package of tailor-made tools to address the specific situation of each of our member states,” she added.
Outlining a “bold approach” to defense, the EU commission chief also announced that Brussels would boost central funding for defense projects that are the common interest of the bloc. She said that another priority was accelerating Ukraine’s accession to the EU.
Von der Leyen acknowledged the challenges provoked by the change at the head of the United States government, which is putting increased pressure on Europe to pay for its own defense.
But she insisted that “Europe is already reforming,” claiming that the bloc’s members had adopted an “urgency mentality,” with defense spending rapidly increasing.
Last year, the bloc’s member states spent an estimated €326 billion on defense between them, up from €214 billion in 2021, the last full year before Russia’s full-scale invasion of Ukraine.
“I believe we are in another period of crisis, which warrants a similar approach,” she said.
“This is why I can announce that I will propose to activate the escape clause for defense investments. This will allow member states to substantially increase their defense expenditure.
“Of course, we’ll have to do this in a controlled and conditional way, and I will also propose a wider package of tailor-made tools to address the specific situation of each of our member states,” she added.
‘Urgency mentality’
Outlining a “bold approach” to defense, the EU commission chief also announced that Brussels would boost central funding for defense projects that are the common interest of the bloc. She said that another priority was accelerating Ukraine’s accession to the EU.
Von der Leyen acknowledged the challenges provoked by the change at the head of the United States government, which is putting increased pressure on Europe to pay for its own defense.
But she insisted that “Europe is already reforming,” claiming that the bloc’s members had adopted an “urgency mentality,” with defense spending rapidly increasing.
Last year, the bloc’s member states spent an estimated €326 billion on defense between them, up from €214 billion in 2021, the last full year before Russia’s full-scale invasion of Ukraine.
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