€150 billion falls short: EU seeks new defense funding – Bloomberg
First program's budget ends this spring (photo: Getty Images)
The European Union is considering ways to secure additional defense funding as its initial €150 billion SAFE program nears completion, according to Bloomberg.
Read also: EU reports record-high defense spending
Sources say discussions are still in the early stages, as the European Commission continues distributing funds from the current lending program. Officials expect that due to discrepancies between member states' requests and finalized contracts, several billion euros may remain unallocated. This issue is being elaborated on now.
Once the funds are fully disbursed this spring, the Commission plans to review the process and consider launching a new round of financing, potentially including a second lending program.
The talks reflect the EU's push to rapidly expand domestic defense production in response to Russia's aggressive policies, as well as US President Donald Trump's desire to reduce American security commitments in Europe.
Background
Last year, the EU launched a lending program to encourage joint defense procurement and simplify the movement of military equipment across the continent, naming it SAFE.
Under the plan, the European Commission raised capital on financial markets and allocated it as loans to member states to purchase specific equipment, including missiles, ground systems, and missile defense technologies.
Initially, EU capitals requested €190 billion, but the Commission approved roughly €150 billion and asked countries to submit spending plans.
The EU executive authorities are now reviewing these plans and distributing funds as long-term, low-interest loans. Recently, the Commission approved plans for 19 countries, while a few remain pending.
"Currently, the Commission is assessing the SAFE plans of the three remaining states," Thomas Renier, a spokesperson for the European Commission, said.
Strengthening Europe's defense
In October, EU officials approved €1.5 billion in funding to boost European defense capabilities amid the war in Ukraine.
The funding had to be provided as grants through 2027, with one-fifth of the total earmarked for defense cooperation with Ukraine.
At the NATO summit in June 2025, EU countries agreed to increase their defense spending to 5% of GDP by 2035. However, not all member states have yet implemented this target, even though they have adjusted their 2026 budgets.
