European Union leaders, NATO Secretary General Mark Rutte, and U.K. Prime Minister Keir Starmer agreed on Monday that Europe must spend more on defense and fill gaps in military capabilities.
“A lot has been done already on European defense. But we need to do more. We need to do it better, stronger, faster. And we need to do it together. Now, the time has come to make choices and take decisions,” President of the European Council António Costa posted on X following the summit in Brussels.
In the wake of Russia’s attack on Ukraine, EU member states have increased their defense budgets and been vocal about fortifying Europe’s military capabilities. Of central importance has been to decrease reliance on the United States, something pushed repeatedly by President Trump, who expects all NATO members to boost their contributions to the alliance.
At the meeting, leaders agreed to boost air and missile defense, ammunition, and military transport, reports Mandiner. However, there was no specific agreement on what forms of financing would be used to achieve these goals.
President of the European Commission Ursula von der Leyen stated that “Europe fundamentally needs to increase defense spending. And to do that, we need to strengthen our defense industrial base.”
She also stressed that the Commission is looking for flexible solutions in the rules governing EU countries’ public finances to make it easier to finance defense investments.
In 2024, EU member states spent an average of 1.9 percent of their GDP on defense, which amounted to around €326 billion, representing a 30 percent increase compared to 2021.
However, the Commission estimates that at least €500 billion in additional spending would be needed over the next decade to maintain the European defense system. This does not take into consideration President Trump’s demand that NATO allies boost defense spending to 5 percent of GDP, although most say this is entirely unrealistic.
Von der Leyen and Costa said a range of financing options could be considered, including increasing national defense budgets, expanding the role of the European Investment Bank, and mobilizing private capital. Joint EU loans were not publicly discussed, although sources say military developments could be financed through loans instead of grants.
While EU leaders discussed the financial implications of boosting their militaries and not relying so much on the U.S., the elephant in the room was the fact that Trump has also indicated he will be imposing new tariffs on EU exports.
As Hungarian Prime Minister Viktor Orbán posted on X, “Everyone in Brussels can see the Trump tornado coming, but most still think they can get away from it. They won’t.”