“Check against delivery”

Thank you, dear Roberta,

Honourable Members,

Alcide de Gasperi said: ‘We do not just need peace among us, but to build a common defence. Not to threaten or conquer, but to deter any attack from the outside. This is the task of our generation. 70 years later, we face the same challenge. Peace within our Union is no longer a given. We are facing a European security crisis. In times of crisis, Europe has always been built. This is the moment for peace through strength. This is the moment for a common defence. At the European Council, I saw an unprecedented level of consensus on European defence. We must think differently and act accordingly. We have mobilised Europes massive resources. More courage will be necessary, and difficult choices await.

Honourable Members,

The European security order is being shaken, and many illusions have been shattered. After the Cold War, some believed Russia could be integrated into Europes economic and security architecture. Others hoped we could rely indefinitely on Americas full protection. We lowered our defence spending from routinely averaging more than 3.5% to less than half of that. We thought we were enjoying a peace dividend, but in reality, we were just running a security deficit. The time of illusions is now over. Europe is called to take greater charge of its own defence. Not in some distant future, but today. Not with incremental steps, but with the courage that the situation requires. We need a surge in European defence. And we need it now.

We need it first and foremost because of the situation in Ukraine. There is the urgent need to fill the gaps in Ukraines military supplies and to provide Ukraine with solid security guarantees. But this moment of reckoning is not only about Ukraine. It is about all of Europe and our entire continents security. Putin has proven time and again that he is a hostile neighbour. He cannot be trusted, he can only be deterred. And we know that Russias military complex is outproducing ours. If we look at military expenditure in real terms, the Kremlin is spending more than all of Europe combined. Europes production is still on a lower order of magnitude. And beyond traditional capabilities, the range of threats we face is getting broader by the day. The European Parliament has argued for years that Europe needed to do more. And you were absolutely right. In this more dangerous era, Europe needs to step up. This is the goal of the plan that I presented to the leaders last week. Its logic is simple: We want to pull every single financial lever we have to strengthen and fast-track our defence production. With the REARM Europe plan, we can mobilise up to EUR 800 billion. Let me focus briefly on some of its main features.

First, on the national escape clause. Let me start with why it is crucial to mobilise national budgets. Today we spend just short of 2% of our GDP on defence. Every analysis agrees that we need to move north of 3%. The entire European budget only reaches 1% of our GDP. So it is obvious that the bulk of new investments can only come from Member States. This is why we are activating the national escape clause – foreseen by our new fiscal rules. This is a new tool that was created just last year. And we propose to trigger it in a controlled, time-bound and coordinated way – for all Member States. This can transform our defence budgets quickly and effectively. Member States could mobilise up to EUR 650 billion over the next 4 years, adding 1.5% of GDP to their defence budgets over 4 years. This is massive. And yet the European Council has tasked us to explore further measures, to facilitate significant defence spending at national level, while ensuring debt sustainability.

Second, the European Council has agreed on our proposal for a new financial instrument. We call it SAFE. Security Action for Europe. We offer Member States up to EUR 150 billion in loans – to invest following a few basic principles. They could focus on a few selected strategic capability domains, from air defence to drones, from strategic enablers to cyber, to mention a few – so that we maximise the impact of our investments. These loans should finance purchases from European producers, to help boost our own defence industry. The contracts should be multiannual, to give the industry the predictability they need. And finally, there should be a focus on joint procurement. We have seen how powerful this can be. Think of Czech and Danish-led initiatives to provide weapons and ammunition for Ukraine. One nation took the lead. Others joined in, to place larger orders. Industry scaled up, and prices went down. It was both quick and efficient. And this is exactly what we need right now: speed and scale. This is why we have chosen the emergency procedure under Article 122 – which is designed precisely for times when ‘severe difficulties arise in the supply of certain products. In other words, the 122 allows us to raise money, to lend it to Member States for them to invest in defence. This is the only possible way for emergency financial assistance and that is what we need now. We will keep the Parliament constantly updated on progress.

This leads me to the third point, on cohesion funds. This is a possibility that we are offering to Member States. Member States will have the possibility to redirect some of their uncommitted funds to defence-related projects. This could be infrastructure, or research and development. This would be voluntary, for those who want to go the extra mile. It will be up to Parliament and Council to decide on this additional option. For the same reason, REARM Europe also includes measures to mobilise private investment, with the European Investment Bank, and our upcoming Saving and Investments Union. Let me add that this will also have positive spillovers for our economy and our competitiveness. New factories and production lines will be necessary, creating good jobs right here in Europe. The investment boost will be felt well beyond the defence sector – from steel to space, from large transport companies to innovative AI start-ups. Together, we have the size to deter any hostile country. We have the economic power. And now, finally, we have the political will, too.

Honourable Members,

We all wish we could live in more peaceful times. But I am confident that, if we unleash our industrial power, we can restore deterrence against those who seek to do us harm. It is time to build a European Defence Union that ensures peace on our continent through unity and strength. This is Europes moment. And Europe will rise to it.

Thank you, and long live Europe.