Von der Leyen proposes 800 billion-euro plan to strengthen EU defences

The chief of the European Union’s executive has proposed an 800 billion-euro (£662 billion) plan to strengthen the defences of EU nations, aiming to lessen the impact of potential US disengagement and provide Ukraine with military muscle to negotiate with Russia following the freeze of US aid.

European Commission President Ursula von der Leyen said the massive “ReArm Europe” package will be put to the 27 EU leaders.

They are holding an emergency meeting in Brussels on Thursday following a week of increasing political uncertainty from Washington, where President Donald Trump questioned both his alliance to the continent and the defence of Ukraine.

“I do not need to describe the grave nature of the threats that we face,” Ms von der Leyen said. Her plan had already been in the works before Mr Trump’s decision early on Tuesday to pause military aid to Ukraine.

Key to the quandary of EU nations has been an unwillingness to spend much on defence over the past decades as they hid under the US nuclear umbrella and were hurt by a sluggish economy, which creates challenges for a quick ramp-up of such spending.

Most of the money Ms von der Leyen is talking about, would come from loosening the fiscal constraints the EU puts on budgetary spending to “allow member states to significantly increase their defence expenditures without triggering” punishing rules aimed at keeping deficits from going too far into the red.

It would help member states to spend on defence without being forced to cut into social spending purely to keep within EU rules.

“So if member states would increase their defence spending by 1.5% of GDP on average, this could create fiscal space of close to 650 billion euros (£537 billion) over a period of four years,” Ms von der Leyen said.

This would be topped up by a loans programme, controversially backed by the common EU budget, of 150 billion euros (£123 billion) to allow member states to invest in defence.

She said military equipment that needs to be improved includes air and missile defence, artillery systems, missiles and ammunition, drones and anti-drone systems and cyber preparedness.

Such a plan will force many EU member states to greatly increase their military spending, which is still below 2% of gross domestic product. Nato secretary-general Mark Rutte has told the member states they need to move to more than 3% as quickly as possible.

The plan will now be the blueprint for Thursday’s summit, although immediate decisions beyond strong commitments were unlikely.

Ms von der Leyen said her plan would also help Ukraine as it struggles now, especially with any joint purchase of military materiel.

“With this equipment, member states can massively step up their support to Ukraine,” she said.

Such measures are all the more essential since Mr Trump directed a “pause” to US assistance to Ukraine as he seeks to pressure Ukrainian President Volodymyr Zelensky to engage in negotiations to end the war with Russia.

In sharp contrast, the EU has always said that it wants Mr Zelensky to negotiate from a position of strength, necessitating more arms for Kyiv, rather than less.

Washington’s move came just days after a disastrous Oval Office meeting in which Mr Trump tore into Mr Zelensky for what he perceived as insufficient gratitude for the more than 180 billion dollars (£141 billion) the US has appropriated for military aid and other assistance to Kyiv since the start of Russia’s invasion on February 24 2022.

In Europe, Mr Trump’s move was also seen as yet more proof it could no longer count on the trans-Atlantic alliance that has been the bedrock of geopolitics since the Second World War.

“Some of our fundamental assumptions are being undermined to their very core,” Ms von der Leyen wrote to EU leaders ahead of Thursday’s summit.

“The pace of change is disconcerting and increasingly alarming.”

Within the EU, unanimity is often necessary for agreements on international affairs and Ukraine, and Hungarian Prime Minister Viktor Orban has often kept the 26 other member states back.

Over the weekend, Mr Orban already indicated in a letter that he would oppose draft conclusions that centre on the defence of Ukraine and its place at the negotiating table. But summit host and EU Council president Antonio Costa is hopeful that on common defence, Mr Orban will not play the spoiler.

In a letter to Budapest, a copy of which was obtained by The Associated Press, Mr Costa wrote that “Regarding European defence, I welcome the fact that no objections are raised in your letter. There appears to be broad agreement on the need for Europe to become more sovereign, more capable and better equipped”.