EU Plans €835 Billion Eurobond Issuance for Defense and Security

The European Union (EU) is planning to issue up to €835 billion in joint eurobonds over the coming years, focusing on defense and internal security, surpassing even the €635 billion Recovery Fund in scale. This massive borrowing effort comes while repayment of pandemic-era Recovery Fund loans has barely begun and member states’ public debts continue to rise. The figure, revealed by EU Budget Commissioner Piotr Serafin at the Commission’s 7th Annual Capital Markets Seminar, includes €150 billion from the new SAFE defense fund (2028–2034) and an additional €685 billion for initiatives like Catalyst Europe, a Crisis Shield, Global Europe, and support for Ukraine. According to Serafin, SAFE will provide favorable loans to member states to boost military readiness, with 19 countries already expressing interest exceeding available funds. He emphasized that EU bonds are now seen as safe, liquid, and attractive investments, bolstered by strong investor demand both inside and outside the bloc. The EU has become the fifth-largest euro-denominated bond issuer, with its debt instruments gaining credibility amid market instability. Serafin also noted that the Commission may receive further mandates from EU leaders to issue more debt in the future, ensuring the EU remains a major player in financial markets for decades to come.