A bitter divide emerged between EU member states and defence manufacturers over strict “Buy European” requirements in the bloc’s €150 billion joint procurement scheme, as negotiations on the Strategic Armament Financing for Europe (SAFE) initiative risk stalling ahead of a 13 May deadline, according to Euractiv.
A Polish presidency compromise text, tabled on Wednesday, proposes allowing non-EU defence firms to bid for SAFE loans only if their home country holds both a defence pact and a trade defence industry agreement with the EU. Third-country suppliers must also specify production sites, guarantee a “minimum share” of EU-made components, and disclose the proportion of foreign parts.
While some states argue the rules are overly restrictive and advocate broader access for partners like Turkey and South Korea, others demand tighter curbs. Greece and the Netherlands are pushing to exclude countries that “fail to respect the rule of law” and block procurement from their industries, according to diplomatic sources.
Meanwhile, Europe’s defence giants, including Airbus, Saab, and missile manufacturer MBDA, have issued a stark warning through lobby group ASD: SAFE funds must prioritise EU-based production to bolster continental security and industrial capacity. The firms argue foreign stockpiles are “depleted” and European factories are already scaling output for critical systems like missiles, cyber defences, and infrastructure protection.
The ASD insists these sectors should be classified as “sophisticated gear” requiring strict EU sourcing, a rebuke to current Commission texts labelling them “non-complex.” While the lobby concedes UK firms could be exempt due to existing supply chains, it stresses any third-country inclusion must be “exceptional.”
With talks deadlocked, the 13 May adoption target appears precarious. Proponents of openness, led by Eastern European states, warn that excluding non-EU partners could delay urgent capability gaps. Yet ASD counters that funneling loans abroad would undermine the EU’s strategic autonomy push.
