The EU has started negotiations on a joint defense fund that could involve Ukraine: what is known

European Union finance ministers began talks on Saturday about a joint defence fund that would buy and own defence equipment and charge members for its use as a way to spend more on defence without burdening national accounts with heavy debt, Reuters reports, UNN writes.

DetailsThe fund, called the European Defence Mechanism (EDM), was proposed by the Bruegel think tank in a paper for ministerial discussions as a way to address concerns about how highly indebted countries can pay for expensive military equipment.

This is part of broader European efforts to prepare for a potential attack by Russia, amid EU governments’ understanding that they can no longer fully rely on the United States for their security, the publication writes.

“This is a good starting point for discussion,” said Portuguese Finance Minister Joaquim Miranda Sarmento.

Several other EU countries have also expressed initial support, noting that the creation of such a fund could be relatively technically simple as it would be based on the eurozone bailout fund model, the European Stability Mechanism.

“We will still have some questions in terms of mandate, finance, contributions, market levers. There are several questions regarding financing, but also regarding the military aspect,” said Sarmento.

The EU already expects to increase military spending by €800 billion ($876 billion) over the next four years by easing its fiscal rules on defence investment and jointly borrowing large defence projects from the EU budget.

EU has approved the White Paper on Defence and details of the ReArm Europe plan: what is envisaged for Ukraine19.03.25, 14:53 • 18756 views

But, as the publication writes, “such options increase public debt – a concern for many highly indebted countries”, while Bruegel’s idea would provide a way to not include part of defence investment in national balances.

The fund would be established under an intergovernmental treaty and would have substantial paid-in and callable capital, allowing it to borrow on the market, the publication writes.

The EDM will be able to accept members from outside the EU, such as the UK, Ukraine or Norway. As the fund will own the equipment it purchases, the debt incurred to pay for it will remain on the EDM’s balance sheet rather than on national accounts.

The EDM is also expected to contribute to the creation of a single European market for defence equipment to reduce costs and pool resources.

“We should consider creating new instruments… to strengthen Europe’s defence capabilities,” said Sarmento.

EU will discuss a joint fund for the purchase of defense equipment, which Ukraine will be able to join – Reuters07.04.25, 11:11 • 161279 views

The fund could focus on “strategic enablers” – expensive military infrastructure and equipment needed for armies to operate, which is now often provided by the United States.

These include joint command and control systems, satellite intelligence and communications, the development of new expensive weapons systems such as fifth- or sixth-generation fighters, integrated weapons systems needed by several countries, such as strategic air defence, strategic large-scale air transport and naval logistics.

Bruegel’s article on the EDM states that Europe has a chance to reduce its military dependence on the US by 2030 only if it maximizes joint procurement and creates a common European defence market, including the UK as a major player in the industrial defence sector to increase competition.

US wants Europe to continue buying American weapons, despite the EU plan – Reuters02.04.25, 16:57 • 23027 views