Brussels, 27 May 2025 (dpa/MIA) - European Union countries on Tuesday gave their final green light to set up a fund worth up to €150 billion ($170 billion) for joint arms procurement.

The loans will be secured via the EU budget and are intended to enable countries to purchase air and missile defence, artillery systems, missiles and ammunition, drones and anti-drone systems, and other military equipment.

European Commission President Ursula von der Leyen welcomed the approval of the fund, dubbed the Security for Action for Europe (SAFE) Instrument.

Rearmament efforts in Europe are intended to deter Russia from possibly attacking another European country after Ukraine. Intelligence agencies believe that Russia will be in a military position to start another war by 2030 at the latest.

"Exceptional times require exceptional measures," von der Leyen said.

Pressure on the EU to significantly increase defence spending and aid to Ukraine has intensified further after Washington suspended US military aid to Ukraine and put its commitment to safeguarding Europe into question.

"Europe must now assume a greater share of responsibility for its own security and defence," she added.

As a next step, capitals can submit their national plans to the commission for approval to receive loans.

Berlin will probably not make use of new financial instrument, as it can obtain loans on the financial markets at favourable conditions even without EU support.

German companies however can receive orders financed through the programme, as well as arms manufacturers from all other EU states, countries aspiring to join the bloc or with a security and defence partnership with the bloc. This includes Ukraine and the UK.

Von der Leyen hopes that together with national investments, private capital and additional funding from the European Investment Bank, the fund could mobilize up to €800 billion for defence.

The new fund is part of a set of initiatives to improve Europe's defence capacities.

The commission also allows member states more leeway for defence spending under the EU's usually strict debt and deficit rules.

Photo: MIA archive