European nations are scrambling to secure tens of billions in European Union loans ahead of deadline for the bloc’s unprecedented €150 billion weapons financing scheme, according to Politico.
Some EU member states told Politico that they were considering using Security Assistance Facility for Europe (SAFE) loan scheme, proposed by the European Commission in March as part of ReArm Europe programme, to help Ukraine in its war against Russia and reduce their long-standing military dependence on the US.
Belgium, Bulgaria, Cyprus, Estonia, Finland, Hungary, Lithuania, and Spain lead the confirmed applicants according to EU defence spokesperson Thomas Regnier. Others, including Bulgaria, the Czech Republic, Greece and Latvia, stated that they would join before the deadline on Tuesday at midnight.
Greece’s Prime Minister Kyriakos Mitsotakis announced a €1.2 billion request for armoured vehicle upgrades and truck procurement, projects originally scheduled for 2036 but dramatically accelerated under the programme.
France, despite its own budget constraints, is expected to join the applicants, leveraging its longstanding advocacy for EU defence integration. Conversely, Germany, Sweden, and the Netherlands are anticipated to decline, reflecting enduring divisions over shared debt obligations.
The urgency stems from dual pressures: depleted weapons stocks across Europe and Kyiv’s desperate need for sustained military support amid signals that Washington may abandon its funding role. EU Defence Commissioner Andrius Kubilius confirmed applications approaching €100 billion.
Financial mechanics and strategic imperatives
SAFE’s structure offers uniquely favourable terms: 45-year repayment windows, 15% advance payments, and interest rates below most national borrowing costs, made possible by leveraging the EU’s triple-A credit rating.
However, fiscally cautious states remain wary. Austria and Italy hesitate over fears additional borrowing could prolong their entanglement in the EU’s excessive deficit procedure, highlighting tensions between rearmament needs and fiscal sustainability.
US President Donald Trump’s demands that NATO allies double military spending and accusations of “free-loading” delivered what French President Emmanuel Macron termed an “electroshock” to European leaders. As a result of the subsequent intense struggle, Poland spends over 4% of its GDP on defence, Romania increases its spending by 43% in just one year, and Germany carries out historic constitutional reforms to free military spending from the debt burden.
