Today I am proud to present a European success story.

A big step forward for our defence readiness.

Today the Commission agreed on the tentative allocation of defence loans under SAFE.

Allowing immediate and massive scale up of the purchase of defence equipment. Boosting our European defence production.

In brief - what is the essence of todays communication:

  • First of all, I would like to remind, that The Security Action for Europe, SAFE, is an integral part of the Readiness 2030 package.
  • SAFE is a financial assistance to Member States for the first time ever in defence at EU level.

That is why SAFE stands as a historic European defence instrument, backed by the EU budget guarantee, providing up to EUR 150 billion of attractive loans to EU Member States to bolster EU defence readiness and to incentivize joint procurement.

  • It also includes provisions to support Ukraine by enabling joint procurement efforts with, in, and for the country.
  • Today we can announce that all 150 bln euros of loans are subscribed by 19 EU Member States. Some Member States were not taking SAFE loans, because they can borrow in the markets themselves with the same price as EU.
  • This Communication includes the tentative allocation per Member State, based on their declared interest. Here was no special key for allocation. 
  • You can now find the numbers on-line. Later on I will explain more details about the numbers. Now, I would like to point out the countries, which have declared the biggest interest and received corresponding allocation: Poland - 43.7 billion, Romania - 16.7 billion; France and Hungary - 16.2 billion; Italy - 14.9 billion euros.
  • Those numbers which I have mentioned, are sending very important message - there is quite an equal geographical spread. Not only Eastern frontier countries are interested in SAFE.
  • I would like also to remind, that when SAFE was announced early in spring, here was a lot of skepticism about possible low interest to take the loans. The contrary is true. The interest from the Member States have been a resounding success: the maximum requests - well beyond the EUR 150 billion available. This is a European success.
  • Very important is also a fact regarding Ukraine, - a majority (13) of the Member States, which requested SAFE loans, have indicated to foresee involving and supporting Ukraine. Even if no precise volumes are indicated at this moment, we expect SAFE to be crucial in this regard.
  • It is also important to remind, that SAFE is also the most open defence programme we have conceived so far. Loans only for Member States to take, but SAFE is also open to EEA-EFTA states, to Ukraine, to acceding/candidate countries and to any third country that has entered a Security and Defence Partnership with the European Union. Bilateral technical agreements with Great Britain and Canada on their participation in SAFE Programme will be negotiated very soon.
  • With SAFE we can unify our fragmented defence procurement. And improve interoperability of military systems.  By encouraging joint procurement in priority areas. Like air/missile defence, ground combat, space, strategic capabilities, Cyber and Space capabilities.

What is important is not only the technical content of SAFE.

No less important is the strong political signal we are sending today.

I will start from one recent episode. During last days ambassador Wolfgang Ishinger, longstanding President of Munich  Security Conference, publicly urged European Union to go for “Big Bang” in building European defence readiness.

It reminded me, how since the start of Commission  mandate, along with President von der Leyen, we have urged a “Big Bang” approach to build our defence readiness.

We have no time for the luxury of incremental improvement.

What we have achieved with “SAFE” is really BIG.

When I visited Washington D.C. before summer, one well known US expert told me that right now, worldwide, SAFE is the biggest financial package to be invested into defence with such a speed. It is also important that we are sending a strong message of support to the frontier countries, when the US is announcing that they will reduce their support.

When the money reaches industry in the form of government procurement - it will be a real BANG in contracts and in production.

We are starting a real Big Bang era in defence.

A Big Bang not only in terms of financial means.

But also, in the speed of implementation.

When in March we approved the White Paper on Defence Readiness, I said that now the most important thing is “implementation, implementation, implementation”.

Today we prove we deliver on implementation:

  • From the SAFE proposal to the adoption of the regulation – 72 days.
  • From the SAFE proposal to the allocation today - 168 days. A record.
  • Facing all the threats, which we know very well, we have no time to wait. We have no time for standard legislative proposals and 18 months of luxury to debate.
  • As soon as we presented our proposal, Member States expressed their interest.
  • And we acted. Quickly, creatively, efficiently.
  • It would be good to continue in the same way  on all other issues related with defence: EDIP, Defence simplification Omnibus, etc.
  • The result: a resounding success.  19 Member States have shown interest.
  • At this stage, we have distributed the allocations based on the amounts requested. Since maximum requested exceed the budget available, we identified a fair and equitable method to distribute assistance
  • And even countries that did not want to take out loans, said they wanted to support SAFE. By joining in common procurement.
  • As President von der Leyen has said, this is a European success.

 

WAY FORWARD

Today we allocated the tentative loan amounts.

I immediately informed the Member States of the amounts we  allocated to them.   

Now we need to move quickly, from allocation, to production.

Amounts are not yet final.

Each Member State must now submit a formal request.

This must include an investment plan.

Deadline: 30th of November. 

The Commission will analyse these plans.

The investment plans will be analyzed also against the fiscal space available for investments and the overall financial feasibility of implementing such investments.

Also Commission will closely monitor  compliance by Member States of EU law, in line with the duty of loyal cooperation.

And if the request fulfils the conditions laid down in the Regulation, we will move forward.

And prepare a proposal for a Council Implementing Decision.

For every participating Member State.

The goal: to sign Loan agreements and Operational Agreements with the Member States in the first quarter of next year and the payments to Member States will follow immediately.

Again, this is a European success story.

In just 2 months we prepared a Regulation, got it approved, and mobilised 150 billion euro, an incredible boost for our defence and our industry.

Today the Commission proves how effectively we bring European added value to build the defence readiness of Member States.