Commission: New industrial defence strategy of EUR 1.5 billion by 2027

Today (5.3.2024) the first industrial defence strategy, proposing common arms markets and a programme for the European defence industry (EDIP), of EUR 1.5 billion by 2027 to accelerate defence production in Europe. These are the two pillars of the new defence industry strategy presented by the European Commission to strengthen defence capabilities in the EU, while the European continent is facing the Russian threat, two years after Russia’s unjustly continuing offensive war against Ukraine. “Europe is still in danger, the war is on our borders and it is a war that does not seem to end soon and that is why we need to strengthen our capacity, moving from an emergency to a vision of medium and long-term support for Ukraine,” said EU High Representative Joseph Borrell, adding: “Europe has no Pentagon, so we need to group together how Member States react, we need a common defence policy”. The Commission’s draft provides: Common market programme for at least 40% of defence equipment by 2030. Ensure that, by 2030, at least 35% of defence production will be traded within the EU. To ensure that by 2030, 50% of the Member States’ defence supplies are of European origin and this increase to 60% by 2035. The President of the Ursula von der Leien Committee wrote in ‘X’: “Today we define our vision of defence readiness with Europe’s defence industrial strategy. It will support the Member States not only to spend more, but also better, including in a European way. And it will link Ukraine’s know-how with our defence industry to facilitate innovation.” According to the Commission, in order to increase European defence industrial preparedness, Member States need to invest more, better, together and European. In order to support Member States in achieving these objectives, the European industrial defence strategy presents a set of actions aimed at: Encourage joint orders from the European defence industry. Support investments technologically advanced to ensure adequate modern defence equipment in the Member States, even in times of crisis. Ensure that EU national budgets and budgets support the necessary instruments to adapt the European defence industry to the new security framework; Integration of a defence preparedness mentality into all policies, in particular by calling for a review of the European Investment Bank’s lending policy this year; Develop closer links with Ukraine through its participation in Union initiatives to support the defence industry and stimulate cooperation between the EU and Ukraine’s defence industries; Cooperation with NATO and our strategic, like-minded and international partners, and closer cooperation with Ukraine. It is noted that the European Defence Industry Programme (EDIP) is the new legislative initiative to bridge short-term emergency measures adopted in 2023 and ended in 2025, in a more structural and long-term approach to achieving defence industrial readiness. This will ensure the continuity of support for the European industrial and technological base in the field of defence to accompany its rapid adaptation to the new reality. EDIP will mobilise EUR 1.5 billion from the EU budget between 2025 and 2027. EDIP’s financial support will, in particular, extend the logic of EDIRPA’s intervention (financial support from the EU budget to compensate for the complexity of cooperation between Member States during the public procurement phase) and ASAP (financial support for defence industries that increase their capacity), in order to further encourage investment by the EFTVA (European industrial and technological basis in the field of defence) . The EDIP budget will also strengthen EU defence industrial cooperation with Ukraine and support the development of its defence industrial and technological base. To this end, EDIP could possibly draw additional funding from the unexpected profits from the immobilised Russian state assets (without prejudice to a Council decision on a proposal from the High Representative). “Today we are adopting a European defence industrial strategy and we are putting forward a proposal for a programme for the European defence industry. We are doing this to respond to the changes in Europe’s security model. Our defence expenditure concerns too many different weapons systems, which are mainly purchased by countries outside the EU. Now that defence budgets in all Member States are growing sharply, we should invest better, which means largely joint investment and investment by Europeans. This will allow us to move from crisis response to a way of structural defence preparedness. In a way that closely integrates Ukraine.” said the Vice President of the Commission, responsible for competition issues, Margaret Vestager. Finally, for his part internal market Commissioner Thierry Breton said: “With our new industrial defence strategy, the Union sets out a clear vision to strengthen our defence industrial readiness. With the European defence industry programme, the Commission shall immediately submit an ambitious instrument for launching the practical implementation of the strategy. With the return of high-intensity conflicts to our continent, Europe can no longer expect to strengthen the ability of the European defence technological and industrial base to produce more and faster. “

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