EU Commission President Ursula von der Leyen has unveiled a five-part plan to incentivise member states to “massively boost” spending on military capability, saying on Tuesday that “we are in an era of rearmament.”
The plan could raise nearly €800bn and help provide military support for Ukraine after the US suspended all military aid to Kyiv in a move which blocks billions of dollars’ worth of ammunition, vehicles, and other equipment. It comes as Donald Trump ramps up the pressure on Kyiv to agree to a peace deal with Russia following Friday’s stormy press conference with Ukrainian President Volodymyr Zelenskyy.
The deterioration in relations with Washington has increased calls to ensure Europe can act independently of the US, raising the prospect that a European army is now one step closer.
At a press conference, the head of the European Commission laid out the ‘ReArm Europe’ plan, which would facilitate a huge increase in spending on defence across the EU, as well as the easing of restrictions on overspending meaning that member states would avoid penalties which would typically apply.
Von der Leyen said that the 27-member bloc would also propose €150bn in loans for defence investments, and would aim to mobilise private capital.
Unveiling the “ReArm Europe” package in Brussels, von der Leyen said: Presenting the “ReArm Europe” package in Brussels, von der Leyen said: “This is a moment for Europe, and we are ready to step up.” She added that the proposals “could mobilise close to €800bn of defence expenditures for a safe and resilient Europe.”
In her message to EU leaders, von der Leyen declared that “a new era is upon us,” adding: “Europe faces a clear and present danger on a scale that none of us has seen in our adult lifetime […] We are living in the most momentous and dangerous of times.”
“It will help member states to pool demand and to buy together. This will reduce costs, reduce fragmentation, increase interoperability and strengthen our defence industrial base,” von der Leyen said.
“With this equipment, member states can massively step up their support to Ukraine. So, immediate military equipment for Ukraine,” she added.
In addition, the plan would see the commission propose the loosening of fiscal constraints the EU puts on government spending to “allow member states to significantly increase their defence expenditures” without triggering punishing budget deficit rules, she said.
“If member states increase their defence spending by 1.5% of GDP on average, this could create fiscal space of close to €650bn over a period of four years,” von der Leyen added.