This week, finance ministers of the European Union will convene to discuss a proposal for a new joint defense fund, known as the European Defense Mechanism (EDM), aimed at financing rearmament across the continent. According to the proposal, countries outside the EU, including Ukraine, will also be able to join the fund.
Reuters reports this based on a document prepared by the Bruegel center for discussion.
European Defense Mechanism: funding rearmament plans
The proposal, which will be considered at an informal meeting in Warsaw on April 12, is part of the EU's efforts to enhance defense capabilities amid Russia's war against Ukraine and the recognition of the need to reduce dependence on the U.S. The fund will complement existing EU plans to increase military spending by €800 billion.
The EDM is proposed to be established as an intergovernmental structure with significant capital, allowing for fundraising in the market. This will enable participating countries (including potential non-EU members like Ukraine, the UK, and Norway) to finance the procurement of expensive "strategic" weapons (command systems, intelligence, air defense, modern fighters, transport, missiles) without an immediate increase in national debt.
The fund could also facilitate the creation of a unified European defense market, primarily sourcing from European contractors. As noted by Bruegel, this approach is key to reducing Europe's military dependence on the U.S. by 2030.
EU's push for a defense fund amid Trump’s return
In December, it was reported that the European Union was discussing the establishment of a joint defense fund worth €500 billion, aimed at increasing defense expenditures ahead of the potential return of newly elected U.S. President Donald Trump.
This funding model, which will also be available to non-EU member states, is gaining traction among key EU countries.
Europe has long been contemplating how to increase defense spending to continue supporting Ukraine and prepare for the arrival of the new U.S. President Trump.