SAFE: Brussels reopens 21.3 billion euros in unspent defense loans
The Commission hopes the money will flow into joint projects with Ukrainian firms. But there is no guarantee Kyiv will benefit, as many countries have shown no interest.
Archive image · Photo: Marzia Cosenza / EC - Audiovisual Service / Wikimedia Commons, CC BY 4.0 (cropped and resized)
The European Commission on Thursday made 21.3 billion euros in unspent defense loans available again under its SAFE program, which totals 150 billion euros. A second round of applications runs until Nov. 13. Brussels wants member states to use the money for joint projects with Ukrainian companies. Defense Commissioner Andrius Kubilius named missile defense, drones and ammunition as priorities.
However, the Commission cannot force governments to involve Ukrainian firms because the loans are national, and current rules do not allow unused funds to go directly to Kyiv. There is "no guarantee" that Ukraine will benefit, an EU official acknowledged. Italy, Hungary and France borrowed well below expectations, and eight countries, including Germany and the Netherlands, never joined SAFE.
As a result, only a few countries such as Poland, Ireland and Greece are likely to apply for new loans. Poland is the largest beneficiary with 43.73 billion euros, nearly 30 percent of the total, and has earmarked 89 percent of it for its domestic arms industry. Because single-country procurement has not been allowed since May, Warsaw may need Ukrainian partners for further loans. Ukraine faces a budget gap of around 70 billion euros.